Eastern District of Virginia

ALEXANDRIA, Va. – Douglas G. “Bo” Taylor, age 52, of Remington, Va., the former Chief of the Remington Volunteer Fire & Rescue Department (“RVFD”), was charged in an eight-count  indictment by a federal grand jury on allegations related to theft from a program receiving federal funds, wire fraud and filing false individual income tax returns, according to charges unsealed today.   In a separate indictment, William Joseph Stuart, age 52, of Bealton, Va., the former President of the RVFD, was also charged with theft from a program receiving federal funds, according to a one-count indictment made public yesterday.   

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; and Thomas J. Kelly, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation, made the announcement today after the indictment of Taylor was unsealed.  Taylor is scheduled to make his initial appearance later this afternoon in the United States District Court for the Eastern District of Virginia. Stuart is expected to appear in the same Court on Friday, August 2, 2013, for his arraignment.

Taylor faces a maximum penalty on the two theft charges of ten years in prison, and twenty years in prison for each of the four wire fraud charges.  These charges carry a maximum fine of $250,000 and full restitution.  Finally, for each of the two charges alleging the filing of false income tax returns, Taylor faces a maximum penalty of three years in prison, a $100,000 fine, and full restitution.  Stuart faces a maximum penalty on the single theft count of ten years in prison, $250,000 fine, and full restitution.

According to the indictment, Taylor served as the Chief of the RVFD from 1994 through 2011, during a time when the RVFD fire station underwent major renovations and reconstruction with funding, in significant part, from the U.S. Department of Agriculture.  The indictment alleges that Taylor, a licensed master electrician, offered to do some of the renovations at the fire station and only seek reimbursement for his out of pocket expenses.  As the charges allege, Taylor then submitted false invoices which contained charges for materials Taylor did not purchase and charges for labor that, at times, was never performed or were inflated from the hours that were actually performed.  Taylor is also accused of using a Prince William County Public Schools System (“PWCS”) credit card to purchase some of the materials used at the fire station project (and elsewhere).  In total, the indictment alleges that Taylor defrauded the RVFD of more than $90,000 and the PWCS of approximately $60,000.  Finally, Taylor is accused of not disclosing the money he fraudulently obtained from the RVFD and winnings from the Virginia lottery on two individual income tax returns filed with the IRS.

A separate indictment alleges that during 2008 and 2009, Stuart embezzled approximately $40,000 from the RVFD financial accounts where he had signature authority.  

This case was investigated by the Federal Bureau of Investigation’s Washington Field Office and the Internal Revenue Service, Criminal Investigation.  Assistant United States Attorney Mark D. Lytle is prosecuting the case on behalf of the United States.

Any person who believes they may have information regarding public corruption in the Northern Virginia area is encouraged to call the FBI’s Northern Virginia Public Corruption Hotline at 703-686-6225.

RICHMOND, Va. – Travis Burley, 26, of Richmond, Va., was sentenced today to 120 months in prison, followed by two years of supervised release, for using, carrying, brandishing, and discharging a firearm during and in relation to a drug trafficking offense.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; and Carl Vasilko, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives, Washington Field office, made the announcement after sentencing by United States District Judge John A. Gibney.

A jury found Burley guilty on April 25, 2013, after a two day trial.  According to evidence at trial, on July 11, 2012, Burley met with a Spotsylvania-area man to purchase four ounces of high grade marijuana at the Spotsylvania Town Center Mall, near the Costco store.  Upon arrival, Burley got into the passenger seat of the victim’s car, placed a loaded handgun to the victim’s head and demanded the drugs.  A struggle ensued and the handgun discharged, hitting both the victim and the defendant.

The investigation was conducted by the Richmond Office of the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Spotsylvania County Sheriff’s Office.  Mr. MacBride and Special Agent Vasilko wish to acknowledge the significant assistance provided by the offices of Spotsylvania County Commonwealth’s Attorney, William F. Neely, and Spotsylvania County Sheriff, Roger L. Harris, during the federal phase of this investigation.  This case was investigated by the Bureau of Alcohol, Tobacco, Firearms, and Explosives.  Assistant United States Attorneys Brian Hood and Erik S. Siebert prosecuted the case on behalf of the United States.

ALEXANDRIA, Va. – Mohammad T. Al-Suqi, 54, of Annandale, Va., was convicted today by a federal jury of nineteen counts of aiding the preparation of a false income tax return, two counts of filing his own false income tax returns, and one count of making false statements to federal agents.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and Thomas J. Kelly, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation, made the announcement after the verdict was accepted by United States District Judge James C. Cacheris.

Al-Suqi was indicted by a federal grand jury on April 25, 2013.  He faces a maximum penalty of three years in prison on each of the tax counts and five years in prison on the false statements count when he is sentenced on October 4, 2013.

According to court records and evidence at trial, the defendant owned and operated the tax preparation businesses Ideal Accounting Solution and Mass Accounting and Tax Corp. in Falls Church, Va.  For the tax years 2007 through 2010, the defendant prepared and filed, on behalf of his taxpayer clients, federal income tax returns that contained materially false and fraudulent information, including false itemized deductions on Schedule A and fraudulent education credits on Form 8863, all of which resulted in large federal income tax refunds for the taxpayers.  For his part, the defendant received fees of between $100 and $250 per return and prepared thousands of federal income tax returns during the relevant time period.

As part of the government’s investigation, the defendant also prepared a fraudulent tax return in 2011 for an undercover IRS agent posing as a taxpayer.  The episode, which was recorded by the undercover agent and presented to the jury at trial, showed the defendant falsifying expenses and deductions in order to produce an income tax refund and indicating that his success as a tax preparer was associated with his ability to manufacture large refunds for his clients.

The defendant also included false and fraudulent expenses and credits on his own 2008 and 2009 federal income tax returns.  In 2013, after the IRS revoked his ability to file electronic tax returns, the defendant continued to prepare and electronically file tax returns using an electronic filing number assigned to his wife, and the defendant lied to IRS agents when he was questioned about the activities.

This case was investigated by IRS Criminal Investigation.  Assistant United States Attorneys Jasmine Yoon, Charles Connolly, and Paul Nathanson are prosecuting the case on behalf of the United States.

ALEXANDRIA, Va. – The chief executive officer of a Virginia-based security contracting firm was sentenced today to serve 48 months in prison for serving as a figurehead owner of a front company created to obtain more than $31 million intended for disadvantaged small businesses through the Small Business Administration’s (SBA) Section 8(a) program, which allows qualified small businesses to receive sole-source and competitive-bid contracts set aside for minority-owned and disadvantaged small businesses.

United States Attorney Neil H. MacBride of the Eastern District of Virginia; Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; National Aeronautics and Space Administration (NASA) Inspector General Paul K. Martin; SBA Inspector General Peggy E. Gustafson; Defense Criminal Investigative Service (DCIS) Special Agent in Charge of Mid-Atlantic Field Office Robert E. Craig; General Services Administration (GSA) Inspector General Brian D. Miller; and Department of Homeland Security (DHS) Deputy Inspector General Charles K. Edwards made the announcement after the sentencing today.
                                                  
Dawn Hamilton, 48, of Brownsville, Md., was sentenced by U.S. District Judge Gerald Bruce Lee in the Eastern District of Virginia.  In addition to her prison term, Hamilton was sentenced to serve three years of supervised release and ordered to forfeit approximately $1.2 million and additionally ordered to pay a fine of $1 million.  On March 15, 2013, Hamilton pleaded guilty to major government fraud.

According to court documents, in approximately 2011, Keith Hedman, 53, of Arlington, Va., formed Company A, which was approved to participate in the 8(a) program based on the 8(a) eligibility of its listed president and CEO, an African-American female.  When the listed president and CEO left Company A in 2003, Hedman became its sole owner, and the company was no longer 8(a)-eligible.

In 2003, Hedman created Company B, another Arlington-based security contractor, to ensure that he could continue to gain access to 8(a) contracting preferences for which Company A was no longer qualified.  Prior to applying for Company B’s 8(a) status, Hedman selected Hamilton, a Company A employee at that time, to serve as a figurehead owner based on her Portuguese heritage and history of social disadvantage. In reality, the new company was managed by Hedman and Company A senior leadership in violation of 8(a) rules and regulations. To deceive the SBA, the co-conspirators falsely claimed that Hamilton formed and founded the company and that she was the only member of the company’s management.  Based on those misrepresentations, Company B obtained 8(a) status in 2004.

From 2004 through February 2012, Hedman – not Hamilton – impermissibly exercised ultimate decision-making authority and control over Company B by directing its finances, allocation of personnel and government contracting activities.  Hedman nonetheless maintained the impression that Hamilton was leading the company, including through forgeries of signatures of Hamilton to documents she had not seen or drafted.  Hamilton signed annual reviews and other documents submitted to the SBA that falsely claimed, among other things, that she controlled Company B.  Hedman also retained ultimate control over the shell business’s bank accounts throughout its existence.  In 2010, Hedman withdrew $1 million in cash from Company B’s accounts and gave the funds in cash to Hamilton and three other conspirators.  In 2011, Hedman approached Hamilton’s brother about starting another shell company to continue the scheme.  The trio submitted another fraudulent application to the SBA, but it was rejected. 

In total, the scheme netted government contracts valued at more than $153 million, from which Company B obtained more than $31 million in contract payments. The various conspirators netted more than $6.1 million that they were not entitled to receive from those payments.  Seven other defendants have pleaded guilty in the scheme.

This case is being investigated by NASA Office of the Inspector General, the SBA-OIG, DCIS-OIG, GSA-OIG and DHS-OIG, with assistance from the Defense Contract Audit Agency. Assistant U.S. Attorneys Chad Golder and Ryan Faulconer, a former Trial Attorney for the Criminal Division’s Fraud Section, are prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

ALEXANDRIA, VA. – Alex Ernesto Calderon Velasquez, 27, of Reston, Va., was indicted by a federal grand jury today on a charge of failure to appear after pre-trial release.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Valerie Parlave, Assistant Director in Charge of FBI’s Washington Field Office; and Lt. Colonel Edwin C. Roessler, Jr., Acting Fairfax County Chief of Police, made the announcement following return of the indictment.

Velasquezfaces a maximum penalty of 10 years in prison if convicted of failing to appear.

According to the indictment and other public records, Velasquez was scheduled to plead guilty on May 24, 2013, to production of child pornography before United States District Court Judge Anthony J. Trenga in United States v. Alex Ernesto Calderon Velasquez, but did not appear as directed. Velasquez allegedly disabled his electronic monitoring bracelet, fled the area, and was later arrested on June 7, 2013, in San Antonio, Texas.

This case was investigated by the FBI Washington Field Office’s Child Exploitation Task Force, the Fairfax County Police Department, and the Harris County Constable’s Office in Texas.

Assistant United States Attorneys Alexander T.H. Nguyen, Jay V. Prabhu, and Matthew Gardner are prosecuting the case behalf of the United States.

Criminal indictments are only charges and not evidence of guilt. A defendant is presumed to be innocent until and unless proven guilty.

ALEXANDRIA, Va. – Ronnie Pierre Holmes, 29, also known as “King,” with no fixed address, pleaded guilty today to a criminal information charging him with sex trafficking of a 15-year-old girl throughout Northern Virginia, Maryland, and Washington, D.C.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Valerie Parlave, Assistant Director in Charge of FBI’s Washington Field Office, and Lt. Col. Edwin C. Roessler, Jr., Acting Chief of the Fairfax County Police Department, made the announcement after the plea was accepted by United States District Judge Liam O’Grady.
“Those individuals who chose to prey on vulnerable juveniles and sexually exploit these children for profit will be prosecuted to the fullest extent of the law,” said United States Attorney Neil H. MacBride.  “My office has made the prosecution of these cases a top priority and we will continue to vigorously pursue those who commit these unconscionable and vile crimes.”
“Mr. Holmes pled guilty today to the sexual trafficking of a child,” said Assistant Director in Charge Parlave. “Together with our law enforcement partners, the FBI is committed to tracking down predators like Mr. Holmes to help protect our children from such a horrific crime.”

            “Sex trafficking crime will not be tolerated in Fairfax County and the Police Department will aggressively fight this crime to protect our great community,” said Acting Chief Roessler.  “We thank the United States Attorney’s Office for the Eastern District of Virginia for their partnership in combatting sex trafficking with us in Fairfax County and nationally.  This partnership, along with that of our many federal law enforcement partners, will endure to continue making Fairfax County a safe place to live, work, and visit.”

Holmes faces a mandatory minimum term of 10 years in prison and a maximum penalty of life in prison when he is sentenced on September 27, 2013.
In a statement of facts filed with the plea agreement, Holmes admitted that he met the 15-year-old runaway outside of her home and that, within hours of meeting the girl, he had sex with her and started to contact other men to set up “dates” with her.  Holmes admitted that he also found sex customers for the victim by posting advertisements on the Internet site www.Backpage.com.  Holmes prostituted the victim in Washington, D.C., Maryland, and at various hotels in Alexandria and Fairfax County, Va.
This case was investigated by FBI’s Washington Field Office and the Fairfax County Police Department. Special Assistant United States Attorney Stacey Luck and Assistant United States Attorney, Michael J. Frank, are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

NEWPORT NEWS, Va. – Aronte D. Jarvis, 25, of Newport News pled guilty today to the 2008 murder of Jonte Terry in the Kmart parking lot located at Oriana Drive in Newport News.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia and Royce E. Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office, made the announcement after the plea was accepted by United States District Judge Arenda L. Wright Allen.

            Jarvis was indicted on October 10, 2012 on charges of murder in aid of racketeering activity, discharge of a firearm during a crime of violence, murder with a firearm and drug conspiracy. His girlfriend, Tayvonna Licorish was charged in a superseding indictment with accessory after the fact and misprision of a felony.  Jarvis will be sentenced to Life in prison when he is sentenced on September 20, 2013.  Licorish is proceeding to trial on September 17, 2013 and faces a maximum sentence of 18 years in prison.

According to the indictment, Jarvis was a member of a criminal organization known as “Thug Relations,” operating in the Aqueduct Apartments, St. Michael’s Apartments, Warwick Lawns, Warwick Town Homes, Heritage Trace Apartments, Mariner’s Landing Apartments, Sharon Drive and the Savage Drive areas of Newport News.  The defendant and others established the power and prestige of the gang through violence, including the murder of Jonte Terry on February 3, 2008.  Terry, 22, was shot in the Kmart parking lot located at Oriana Drive in Newport News.  The indictment alleged that Terry was killed by Jarvis for the purpose of maintaining his position in “Thug Relations.”

            This case was investigated by the Federal Bureau of Investigation, with the assistance of the Newport News Police Department and the Virginia State Police.  Assistant United States Attorneys Howard J. Zlotnick and Lisa R. McKeel are prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae.  Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

ALEXANDRIA, Va. – Angel Campos Tellez, 27, an illegal alien from Mexico, who lived in Greenbelt, Md., was sentenced today to 46 months in prison, followed by three years of supervised release, for conspiring to transport more than 100 women to engage in commercial sex acts in Virginia, Maryland, and Delaware.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Kenneth T. Cuccinelli, II, Attorney General of Virginia; and John P. Torres, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Washington, D.C., made the announcement after sentencing by United States District Judge Claude M. Hilton.
            “There are many moving parts in the vile sex trafficking industry – the recruiters, the transporters, and the so called ‘pimps.’  Here, Tellez, a leader, drove victims up and down the eastern seaboard to be prostituted in various localities.  This reprehensible conduct will not be tolerated,” said U.S. Attorney Neil H. MacBride.
             “For three years, Campos Tellez led a network that exploited women to a dangerous life of prostitution, violence, and gangs,” said Cuccinelli. “Whatever their role may be in a sex trafficking ring, we want these criminals to know: we will find you, we will prosecute you, and we will lock you up for your crimes. Virginia will not turn a blind eye to this abusive and disgusting criminal enterprise.”

            “Protecting our communities from those who engage in human trafficking is a top priority for ICE Homeland Security Investigations," said John P. Torres, Special Agent in Charge of HSI Washington. "HSI special agents will continue to work with our law enforcement partners to identify victims of human trafficking and to pursue the criminals who prey on them."

            Campos Tellez pleaded guilty on March 27, 2013, to conspiracy to transport women to engage in prostitution. According to court records, from 2009 through July 2012, Campos Tellez was a leader of a network that transported women to engage in commercial sex acts in Manassas, Woodbridge, Virginia Beach, Norfolk, Newport News, Va., Baltimore, and Delaware.  As a leader, Campos Tellez was responsible for collecting prostitution proceeds, advertising the prostitution scheme, and obtaining lodging for the victims he prostituted.  Campos Tellez instructed the women he prostituted to charge $30 for 15 minutes of vaginal sex, and he personally received at least $15,000 in proceeds from commercial sex acts.

            This case was investigated by the Transnational Gang Unit of HSI, which is a member of the Northern Virginia Human Trafficking Task Force.  Virginia Assistant Attorney General and Special Assistant United States Attorney Marc J. Birnbaum and Assistant United States Attorney Michael J. Frank are prosecuting the case on behalf of the United States.

            Founded in 2004, the Northern Virginia Human Trafficking Task Force is a collaboration of federal, state, and local law enforcement agencies – along with nongovernmental organizations – dedicated to combating human trafficking and related crimes.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

ALEXANDRIA, Va. – The former chief executive officer of a Virginia-based security contracting firm was sentenced in the Eastern District of Virginia to 72 months in prison for creating a front company to obtain more than $31 million intended for disadvantaged small businesses and for bribing the former regional director for the National Capital Region of the Federal Protective Service (FPS) as part of the scheme. The front company obtained the contracts through the Small Business Administration’s (SBA) Section 8(a) program, which allows qualified small businesses to receive sole-source and competitive-bid contracts set aside for minority-owned and disadvantaged small businesses.

U.S. Attorney Neil H. MacBride of the Eastern District of Virginia; Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; National Aeronautics and Space Administration (NASA) Inspector General Paul K. Martin; SBA Inspector General Peggy E. Gustafson; Defense Criminal Investigative Service (DCIS) Special Agent in Charge of Mid-Atlantic Field Office Robert E. Craig; General Services Administration (GSA) Inspector General Brian D. Miller; and Department of Homeland Security (DHS) Deputy Inspector General Charles K. Edwards made the announcement after sentencing by United States District Judge Gerald Bruce Lee.

            “Keith Hedman used his expertise gleaned from decades as a government contractor to cheat the system and steal tens of millions from minority-owned small business owners,” said Acting Assistant Attorney General Raman. “Today’s sentence shows that those who resort to deceit and bribery to secure federal contracts will be caught and held accountable.”

“Keith Hedman tried to game the system and take advantage of a government program designed to help minority-owned small businesses,” said U.S. Attorney Neil H. MacBride.  “He committed fraud, he undermined the trust of the U.S. government and this type of conduct will not be tolerated.  My office is committed to prosecuting those who cheat the government to the fullest extent of the law.”

            “I commend the outstanding efforts of our agents and the other law enforcement agencies involved in this case in protecting the integrity of the Federal Government’s procurement program and taxpayer dollars” said NASA Inspector General Paul K. Martin.

            Keith Hedman, 53, of Arlington, Va., was sentenced today to 72 months in prison and two years of supervised release after pleading guilty to major government fraud and conspiracy to commit bribery on March 13, 2013. Hedman was also ordered to forfeit approximately $6.1 million and pay a $15,000 fine.

According to court documents, in or about 2011 Hedman formed Company A, which was approved to participate in the 8(a) program based on the 8(a) eligibility of its listed president and CEO, an African-American female. When the listed president and CEO left Company A in 2003, Hedman became its sole owner, and the company was no longer 8(a)-eligible.

In 2003, Hedman created Company B, another Arlington-based security contractor, to ensure that he could continue to gain access to 8(a) contracting preferences for which Company A was no longer qualified. Prior to applying for Company B’s 8(a) status, Hedman selected an employee, Dawn Hamilton, 48, of Brownsville, Md., to serve as a figurehead owner based on her Portuguese heritage and history of social disadvantage. In reality, the new company was managed by Hedman and Company A senior leadership in violation of 8(a) rules and regulations. To deceive the SBA, the co-conspirators falsely claimed that Hamilton formed and founded the company and that she was the only member of the company’s management. Based on those misrepresentations, Company B obtained 8(a) status in 2004.

From 2004 through February 2012, Hedman – not Hamilton – impermissibly exercised ultimate decision-making authority and control over Company B by directing its finances, allocation of personnel, and government contracting activities.  Hedman nonetheless maintained the impression that Hamilton was leading the company, including through forgeries of signatures of Hamilton to documents she had not seen or drafted. Hedman also retained ultimate control over the shell business’s bank accounts throughout its existence.  In 2010, Hedman withdrew $1 million in cash from Company B’s accounts and gave the funds in cash to Hamilton and three other conspirators. In 2011, Hedman approached Hamilton’s brother about starting another shell company to continue the scheme.  The trio submitted another fraudulent application to the SBA, but it was rejected. 

Later in 2011, Hedman agreed to pay Derek Matthews, 47, of Harwood, Md., the former FPS Regional Director for the National Capital Region, $50,000 and a percentage of new business in exchange for Matthews helping Company B obtain contracts.  During the bribery scheme, Matthews served as FPS Deputy Assistant Director for Operations, a law enforcement position in which he had daily oversight of physical security programs and oversight of approximately 13,000 FPS officers at approximately 9,000 federal buildings.

In total, the scheme netted government contracts valued at more than $153 million, from which Company B obtained more than $31 million in contract payments. The various conspirators netted more than $6.1 million that they were not entitled to receive from those payments. Seven other defendants have pleaded guilty in the scheme.

This case is being investigated by NASA Office of the Inspector General (OIG), the SBA -OIG, DCIS-OIG, GSA-OIG, and DHS-OIG, with assistance from the Defense Contract Audit Agency. Assistant U.S. Attorneys Chad Golder and Ryan Faulconer, a former Trial Attorney for the Criminal Division’s Fraud Section, are prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

ALEXANDRIA, Va. – Tobechi Eyinna Onwuhara, 33, of Dallas, Texas, pleaded guilty today to charges of conspiracy to commit bank fraud, conspiracy to commit money laundering, and computer fraud. 

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; David E. Beach, Special Agent in Charge of the United States Secret Service’s Washington Field Office; and Earl L. Cook, Alexandria Chief of Police; made the announcement after the plea was accepted by United States District Judge Claude M. Hilton.

Onwuhara was charged with conspiracy to commit bank fraud and a federal warrant was issued for his arrest on Aug. 1, 2008. He was later indicted by a federal grand jury on April 21, 2011.  He was arrested in Australia after more than four years as a fugitive.  Onwuhara faces a maximum penalty of thirty years in prison on the conspiracy to commit bank fraud charge alone when he is sentenced on September 20, 2013.

According to court records, Onwuhara is the ringleader of a group of Nigerians who used fee-based web databases to search for potential victim account holders with large balances in home equity line of credit (HELOC) accounts.  This information included name, address, date of birth, and social security number.  Once the conspirators identified a victim, they used other online databases to obtain information commonly used in security questions, such as the victim’s mother’s maiden name.  The conspirators then obtained credit reports on the victims in order to verify personal information and account balances.

Armed with a victim’s personal information, the conspirators called the victim’s financial institution, impersonated the victim, and transferred the majority of the available money from the HELOC account into an account from which a wire transfer could be sent.  The conspirators would then wire transfer hundreds of thousands of dollars to domestic or overseas accounts controlled by members of the conspiracy.  The conspirators used caller-ID spoofing services, prepaid cell phones and PC wireless Internet access cards, and transferred victims’ home telephone numbers in order to impersonate the victim and avoid identifying themselves. 

Once the fraudulently-transferred funds arrived in the destination bank, a conspirator with access to the account would withdraw funds and transfer them to other members of the conspiracy after taking a portion of the proceeds for himself. 

This case was investigated by the FBI’s Washington Field Office, United States Secret Service’s Washington Field Office, and the Alexandria Police Department, with assistance from the U.S. Marshals Service. Assistant United States Attorneys Alexander T.H. Nguyen and Lindsay Kelly are prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

ALEXANDRIA, Va. – Robert Fenn, 27, of Herndon, Va., was sentenced today to 120 months in prison, followed by 20 years of supervised release, for receipt and possession of child pornography.  Prior to his June 2012 arrest on related, local charges, Fenn was a special education teacher at Poplar Tree Elementary School in Chantilly, Va.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, John P. Torres, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Washington, D.C.; and Lt. Colonel Edwin C. Roessler, Jr., Acting Fairfax County Chief of Police, made the announcement after sentencing by United States District Judge James C. Cacheris.
“We vigorously investigate and prosecute all those who commit child pornography offenses,” said U.S. Attorney Neil H. MacBride.  “This is especially so when those same criminals have been entrusted with the care of our children.  The defendant will now have the next ten years to consider the consequences of his actions.”
On April 3, 2013, a federal jury returned a verdict of guilty against Fenn for one count of receipt of child pornography and one count of possession of child pornography.  According to court records and evidence adduced at trial, Fenn was identified through an international initiative originated with Italian law enforcement that investigated a website offering access to child pornographic images and/or video files identified by the domain name “liberalmorality.com.”  The website was hosted in the United States and HSI obtained internet records showing each internet account that accessed the website and the specific images each account accessed. 
Fenn taught special education at Poplar Tree Elementary School in Chantilly, Va. and gave private music lessons to children in their homes. Fenn admitted an interest in girls between the ages of nine and 14, which corresponded to the ages of the victims of child pornography depicted in images and videos found on Fenn’s computers and external hard drives.
This case was investigated by HSI’s Child Exploitation Section in the Washington Field Office and the Fairfax County Police Department. Special Assistant United States Attorney Alicia J. Yass, a Trial Attorney with the Child Exploitation and Obscenity Section of the Justice Department’s Criminal Division, and Assistant United States Attorneys Lindsay Kelly and Jay Prabhu are prosecuting the case on behalf of the United States.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc. For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”

ALEXANDRIA, Va. – Eric Harroun, 30, of Phoenix, Ariz., was indicted by a federal grand jury today on two charges related to his alleged fighting alongside an Al Qa’ida affiliated terrorist group in Syria.

Neil H. MacBride, U.S. Attorney for the Eastern District of Virginia, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement.

Harroun, a U.S. citizen who served with the U. S. Army from 2000 to 2003, was indicted on the following charges:

• Conspiracy to provide material support to a foreign terrorist organization;
• Conspiracy to use destructive devices overseas. 

The maximum punishment for conspiring to provide material support to a foreign terrorist organization, as alleged in this particular indictment, is 15 years in prison.  The second count, conspiracy to use destructive devices overseas, carries a maximum punishment of life in prison. 

The indictment alleges that Harroun fought with Jabhat al-Nusrah (al-Nusrah), a designated foreign terrorist organization.  al-Nusrah is one of several aliases used by the “al Qa’ida in Iraq” terrorist organization, and since November 2011 the group has claimed responsibility for nearly 600 terrorist attacks in Syria.

            According to court documents, Harroun allegedly crossed into Syria in January 2013 and fought with members of al-Nusrah against the Bashar al-Assad regime in Syria. The documents allege that Harroun participated in attacks with al-Nusrah and carried and used various firearms, including a sniper rifle, an AK-47 style machine gun, and a rocket propelled grenade (RPG) weapon.

            This case is being investigated by the FBI’s Washington Field Office. Assistant U.S.  Attorneys Carter Burwell and Lynn Haaland are prosecuting the case on behalf of the United States, with assistance from the Justice Department’s National Security Division.

Criminal indictments are only charges and not evidence of guilt. A defendant is presumed to be innocent until and unless proven guilty.

ALEXANDRIA, Va. – Michael Wellington Logan, 52, of Clermont, Fl., was convicted late yesterday by a federal jury on all 11 counts with which he was charged including conspiracy, wire fraud, and money laundering. 

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Valerie Parlave, Assistant Director of FBI’s Washington Field Office, made the announcement after the jury's verdict was accepted by United States District Judge Liam O’Grady.

Logan faces a maximum penalty of thirty years on each count of conspiracy and wire fraud, and ten years on each money laundering count when he is sentenced on September 20, 2013.

Logan was indicted on March 27, 2013, by a federal grand jury in Alexandria, Va.  According to court records and evidence adduced at trial, Logan engaged in a brazen scheme to defraud the Navy Federal Credit Union (“NFCU”) in Vienna, Va.  Logan worked with co-conspirator Theodric Delur Bingham, 42, of Snellville, Ga., to found a company doing business as “Cash Money Brothers, LLC” to convince unwitting borrowers to apply for loans to obtain purchase mortgages.  In advance of the loans from NFCU, Logan filed quit claim deeds to make it appear that borrowers already owned the properties, in order to apply for secondary equity loans instead of purchase mortgage loans, which have stricter requirements.  After submitting false membership applications to NFCU, Logan and Bingham also paid NFCU insider Duane Gerarda Nixon, 40, of Dumfries, Va., to push false loan applications to fund the loans.  After Logan and Bingham convinced borrowers to turn over loan proceeds, rather than use them to pay the mortgages on the investment properties as promised, Logan used the proceeds to personally enrich himself.  In other instances, following approval of the fraudulent loan applications, Logan and his co-conspirators would direct the loaned funds into the Cash Money Brothers’ account without the knowledge of the investment property owners and convert those funds to their own personal use.  As a result of the scheme, NFCU lost more than $476,000.  Bingham and Nixon had previously been convicted and await sentencing.

This case was investigated by the FBI’s Washington Field Office.  Assistant United States Attorneys Alexander T. H. Nguyen and Lindsay A. Kelly are prosecuting the case on behalf of the United States.

ALEXANDRIA, Va. – Two former executives at a Virginia-based security contracting firm were sentenced in the Eastern District of Virginia for their roles in using a front company to obtain more than $31 million intended for disadvantaged small businesses as part of the Small Business Administration’s (SBA) Section 8(a) program. This program allows qualified small businesses to receive sole-source and competitive-bid contracts set aside for minority-owned and disadvantaged small businesses.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; National Aeronautics and Space Administration (NASA) Inspector General Paul K. Martin; SBA Inspector General Peggy E. Gustafson; Defense Criminal Investigative Service (DCIS) Special Agent in Charge of Mid-Atlantic Field Office Robert E. Craig; General Services Administration (GSA) Inspector General Brian D. Miller; and Department of Homeland Security (DHS) Deputy Inspector General Charles K. Edwards made the announcement after sentencing by United States District Judge Leonie M. Brinkema.
Joseph Richards, 52, of Arlington, Va., and David Lux, 66, of Springfield, Va., were sentenced today to 27 and 15 months in prison, respectively, after pleading guilty to conspiracy to commit major government fraud in March 2013.  The court imposed restitution in the amount of $120,378.73 against Richards and required Lux to forfeit $115,556.96. 

According to court documents, Richards and Lux were executives at an Arlington-based security contractor referred to in court documents as Company A. In approximately 2001, Keith Hedman, 53, of Arlington, formed Company A, which was approved to participate in the 8(a) program based on the 8(a) eligibility of its listed president and CEO, an African-American female. When the listed president and CEO left Company A in 2003, Hedman became its sole owner, and the company was no longer 8(a)-eligible.

In 2003, Hedman created Company B, another Arlington-based security contractor, to ensure that he could continue to gain access to 8(a) contracting preferences for which Company A was no longer qualified. Prior to applying for Company B’s 8(a) status, Hedman selected an employee, Dawn Hamilton, 48, of Brownsville, Md., to serve as a figurehead owner based on her Portuguese heritage and history of social disadvantage. In reality, the new company was managed by Hedman and Company A senior leadership in violation of 8(a) rules and regulations. To deceive the SBA, the co-conspirators falsely claimed that Hamilton formed and founded the company and that she was the only member of the company’s management. Based on those misrepresentations, Company B obtained 8(a) status in 2004. From 2004 through February 2012, Hedman – not Hamilton – impermissibly exercised ultimate decision-making authority and control over Company B by directing its finances, allocation of personnel, and government contracting activities.

Richards and Lux joined the scheme in 2005 and 2008, respectively. Hedman offered Richards and Lux ownership stakes in Company B in exchange for their assistance in misleading the SBA and other U.S. government agencies, and both men accepted. Once they joined the conspiracy, Richards and Lux took a variety of actions to further the fraud against the United States. In 2008, for example, both Richards and Lux helped Company B overcome a protest by another company that accused Company A and Company B of improperly obtaining a $48 million Coast Guard contract.

            From 2008 to 2010, Richards moved to Company B’s payroll to help Hedman illegally operate Company B. In 2010, Lux helped Hedman withdraw more than $1 million in cash from Company B’s accounts, which Hedman then disbursed to various conspirators, including $100,000 in cash to both Richards and Lux. Richards and Lux also assisted Hedman, Hamilton, and other co-conspirators prepare false documents, including annual reviews, to submit to SBA and other government agencies.

In total, the scheme netted government contracts valued at more than $153 million, from which Company B obtained more than $31 million in contract payments. The various conspirators netted more than $6.1 million that they were not entitled to receive from those payments.

Six other defendants have pleaded guilty in the scheme:

• Hedman is scheduled to be sentenced by U.S. District Judge Gerald Bruce Lee on June 21, 2013.
• Hamilton is scheduled to be sentenced by U.S. District Judge T. S. Ellis, III on June 28, 2013.
• David Sanborn, 60, of Lexington, S.C., Company A’s former President, is scheduled to be sentenced by U.S District Judge Claude M. Hilton on July 19, 2013.
• John Hertogs, 42, of Winter Springs, Fl., Company B’s former director of operations, is scheduled to be sentenced by Judge Hilton on July 12, 2013, for submitting a fraudulent 8(a) application for a follow-on company that Hedman and Hamilton intended to use once Company B graduated from the 8(a) program.
• Derek Matthews, 47, of Harwood, Md., former Regional Director for the National Capital Region of the Federal Protective Service, is scheduled to be sentenced by Judge Brinkema on July 19, 2013, for a related bribery scheme in which Hedman agreed to pay Matthews $50,000 and a percentage of new business in exchange for Matthews helping Company B obtain contracts.
• Michael Dunkel, 59, of Merritt Island, Fl., is scheduled to be sentenced by Judge Lee on Oct. 4, 2013, for obtaining more than $4.4 million in payments by using Company B as a pass-through company on NASA contracts.

This case is being investigated by NASA Office of the Inspector General (OIG), the SBA -OIG, DCIS-OIG, GSA-OIG, and DHS-OIG, with assistance from the Defense Contract Audit Agency. Assistant U.S. Attorneys Chad Golder and Ryan Faulconer, a former Trial Attorney for the Criminal Division’s Fraud Section, are prosecuting the case on behalf of the United States.

Norfolk, Va. – Angie L. Gilchrist, 58, of Suffolk, Va., was sentenced today to 33 months in prison, followed by a three year term of supervised release, for defrauding the Virginia Medicaid Program, a health care program for indigent persons that is jointly funded by the federal government and the State of Virginia.  She was also ordered to make restitution to the Virginia Medicaid Program in the amount of $294,713.00.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and Virginia Attorney General Ken Cuccinelli made the announcement after sentencing by United States District Senior Judge Henry C. Morgan, Jr.

Gilchrist pleaded guilty on February 19, 2013 to health care fraud.  According to court documents, Gilchrist owned and operated A-Z Alpha Omega In Home Personal Care Service LLC, a business located in Suffolk that was authorized to provide respite care to Medicaid recipients.  Respite care is designed to provide temporary, substitute care for a Medicaid recipient that is normally provided by the family or another unpaid primary caregiver of the recipient.  These services are provided on a short-term basis because of the emergency absence or need for routine or periodic relief of the primary caregiver.  Between October 2008 and October 2012, Gilchrist filed approximately 385 false and fraudulent claims for reimbursement with the Virginia Medicaid program.  These fraudulent claims represented that respite care had been provided by her company to 38 Medicaid recipients, when in fact no such care had been provided.  As a result, Gilchrist obtained health care benefit payments in the approximate amount of $294,713.00 to which she was not entitled.          

This case was investigated by the FBI and the Office of the Virginia Attorney General, Medicaid Fraud Control Unit.  Assistant United States Attorney Alan M. Salsbury prosecuted the case on behalf of the United States.

NORFOLK, Va. – Alton B. Couther, III, 31, of Norfolk, Va., was sentenced today to 180 months in prison, followed by 5 years of supervised release, for two firearms charges stemming from a volatile altercation with law enforcement last fall.  Couther was also ordered to pay $7,571.75 in restitution to Geico Auto Insurance in connection with a vehicle he totaled during the commission of his offense.  

Neil H. MacBride, United States Attorney for the Eastern District of Virginia made the announcement after sentencing by United States District Judge Raymond A. Jackson.

Couther pleaded guilty on March 13, 2013, to possessing a firearm in furtherance of a drug trafficking crime and possessing a firearm as a convicted felon.  According to court documents, on October 17, 2012, an officer with the Norfolk Police Department witnessed Couther drive his car through a red light.  The officer attempted to pull Couther over in order to issue a citation but, rather than stop, Couther instead led the officer on a high-speed chase during which he jumped a median and drove the wrong direction on a one-way span of road.  The chase ended when Couther crashed into a utility pole and totaled the car he was driving; he then attempted to flee on foot.  Norfolk police quickly apprehended Couther and found a Kel-Tec .380 in his pants pocket, and marijuana, scales, and cash in a backpack in the car.  Prior to these events, Couther had been convicted of multiple counts of possession with intent to distribute cocaine, as well as for possession of a firearm while in possession of narcotics.

This case was investigated by the Bureau of Alcohol, Tobacco, Firearms and Explosives, and the Norfolk Police Department. Assistant United States Attorney V. Kathleen Dougherty prosecuted the case on behalf of the United States.

RICHMOND, Va. – Torry Von Zenon, 41, of Las Vegas, Nevada, was sentenced today to 384 months’ imprisonment for his role in a drug trafficking conspiracy involving several kilograms of cocaine.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia; and Karl C. Colder, Special Agent in Charge for the Drug Enforcement Administration (DEA)’s Washington Division, made the announcement after the sentencing was announced by United States District Judge Henry E. Hudson.

            According to evidence presented at trial, Zenon and others conspired together to broker a 100 kilogram cocaine transaction for a potential buyer in Baltimore, Maryland.  The participants flew to Richmond, Virginia, and then traveled to Baltimore for a meeting scheduled to take place on January 27, 2012.  The conspirators met at an apartment leased by Zenon and counted the approximately $1,499,377.00 in United States currency gathered by the proposed buyers.  Soon after the money was counted, three co-defendants (Dion Williams, Torry Zenon, and Vincent Williams) were arrested in possession of the cash, two Royal Sovereign money counters, two handguns, and other items.  As a result, the transaction was not consummated.  Both Zenon and Vincent Williams were found guilty on January 24, 2013, of conspiracy to distribute five kilograms or more of cocaine following a jury trial.

            As part of the same conspiracy, Hiram Alvarez and others coordinated a second drug transaction to take place in March 2012.  Documents filed with the Court show that Alvarez contacted co-defendant Topeka Sam in February 2012, and advised that he (Alvarez) had a seller willing to supply approximately 50 kilograms of cocaine.  Sam, in turn, located two buyers who were willing to pay $26,000 per kilogram of cocaine.  To execute those transactions, Sam and another co-defendant travelled to Richmond, Virginia, on March 7, 2012, to meet with sellers at the Hooter’s Restaurant, located at 7912 West Broad Street, Richmond, Virginia.  At Hooter’s, Sam met with three individuals who she believed to be the sellers.  Sam and the proposed sellers travelled to a storage facility located at 9001 Brook Road, Glen Allen, Virginia, where she inspected an undercover “trap” vehicle designed to conceal and transport kilogram quantities of cocaine.  Sam viewed approximately 50 kilograms of cocaine that were concealed in the vehicle.  She agreed to purchase all 50 kilograms of cocaine, with 25 kilograms going to a buyer from Maryland, and another 25 kilograms going to a buyer from New York.

On March 8, 2012, Sam, co-defendant Percy Robinson, and another co-defendant met with the proposed sellers at an address in Randallstown, Maryland.  At that location, Robinson negotiated his proposed purchase of 25 kilograms of cocaine and presented approximately $250,000 in United States currency to serve as partial payment for the cocaine purchase.  Robinson agreed to meet with the sellers on the following day to present additional money to complete the drug transaction.  Robinson left the address and was intercepted by law enforcement during a traffic stop, at which time he was in possession of approximately $255,360.

            Later on March 8, 2012, Sam and co-defendant Reginald Marshall met with the proposed sellers at the Randallstown, Maryland address to discuss Marshall’s proposed cocaine purchase.  Marshall negotiated the transaction and presented approximately $80,000 in United States currency to serve as partial payment for the cocaine.  Marshall and Sam left soon thereafter with the understanding that Marshall would gather more funds to complete the purchase.  Later that same day, law enforcement officers intercepted Marshall and Sam during a traffic stop, at which time the two were in possession of approximately $89,074.

            Finally, on April 24, 2012, Sam and Robinson travelled to Richmond, Virginia to meet with proposed sellers about another drug transaction.  During that meeting, Robinson agreed to purchase another 30 kilograms of cocaine.  Soon thereafter, both Sam and Robinson were arrested by law enforcement for their alleged role in the drug trafficking conspiracy. 

            To date, all of the arrested defendants have been convicted and sentenced:

•  Hiram Alvarez pleaded guilty and was sentenced to 324 months’ imprisonment on March 24, 2013.

• Dion Levering Williams pleaded guilty and was sentenced to 252 months’ imprisonment on April 19, 2013.

• Vincent A. Williams was convicted at trial and was sentenced to 250 months’ imprisonment on April 26, 2013. 

• Topeka Kimberly Sam pleaded guilty and was sentenced to 130 months’ imprisonment on January 11, 2013.

• Percy Robinson pleaded guilty and was sentenced to 130 months’ imprisonment on November 13, 2012. 

• Reginald Marshall pleaded guilty and was sentenced to 120 months’ imprisonment on January 25, 2013. 

• Susan Smallwood pleaded guilty and was sentenced to 57 months’ imprisonment on November 19, 2012.

            The investigation was coordinated by the Drug Enforcement Administration, which received assistance from the Chesterfield County Police Department, Hanover Sheriff’s Office, Richmond Police Department, Virginia State Police, Virginia Commonwealth University Police Department, Baltimore County Police Department, Baltimore City Police Department, Maryland State Police Department, Colton Police Department, Maryland Transportation Authority Police, Maryland Transit Administration Police, Maryland Natural Resources Police, Chino Police Department, Riverside Police Department, San Bernardino City Police Department, Pine Hill Police Department, Portsmouth Sheriff’s Office, and Department of Homeland Security – Homeland Security Investigations.  Assistant United States Attorneys Michael Gill, Jamie Mickelson, and Peter Duffey prosecuted the case on behalf of the United States.

RICHMOND, Va. – Adam Hobart Stanley, 35, of Manakin-Sabot, Virginia, was sentenced today to 210 months’ imprisonment in U.S. District Court after pleading guilty to one count of production of child pornography.  Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement after Stanley was sentenced by United States District Judge John A. Gibney. 
Judge Gibney additionally ordered Stanley to pay $205.21 in restitution to the victim.  He will also be required to register as a sex offender in any U.S. jurisdiction in which he lives, works, or attends school. 
According to court documents, Stanley sexually abused a 12-year-old child whom he babysat during 2012, and used a hidden video camera to produce a child pornography video of that abuse.  Additional evidence revealed that Stanley had distributed child pornography videos and images over a peer-to-peer network on the Internet and had also saved hundreds of videos and images of child pornography on various computers and computer media. 
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.
This case was investigated by the Federal Bureau of Investigation Innocent Images Task Force.  Special Assistant United States Attorney Gene Fishel of the Virginia Attorney General’s Office prosecuted the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.usdoj.gov/usao/vae.  Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on http://pacer.uspci.uscourts.gov.
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NEWPORT NEWS, Va. – James Allen Sutton, 32, of Hampton, Va. pled guilty today to a conspiracy to defraud the United States, a conspiracy to launder money, and being a felon in possession of a firearm.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Thomas J. Kelly, Special Agent in Charge of the Internal Revenue Service Criminal Investigation’s Washington, D.C., Field Office, and Carl J. Vasilko, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATFmade the announcement after the plea was accepted by United States Magistrate Judge Doug Miller.

            Sutton was indicted March 13, 2013, in a conspiracy to impede and impair the IRS, false tax and loan statements, money laundering conspiracy, money laundering, drug conspiracy, drug distribution and possession with intent to distribute marijuana, and felon in possession of a firearm.  Based on his guilty pleas he faces a maximum penalty of five years on the conspiracy to defraud the United States, twenty years on the money laundering conspiracy and ten years on the firearm conviction when he is sentenced on September 24, 2013.

            According to a statement of facts filed with his plea, in 2009, following an auto accident, police seized $18,000 in currency from Sutton. He contested the forfeiture of the money into May, 2011, when he was arrested with approximately $13,000 in currency, jewelry, a firearm and a quantity of marijuana. Sutton has a prior felony conviction and was therefore a prohibited person not allowed to possess firearms. Police also recovered false 1099 forms written by his co-conspirator which Sutton used to show a legitimate source of income and obtain loans including a re-financing of his home. Sutton used these amounts on his tax returns in 2007-2009.  The co-conspirator was also prosecuted and admitted to falsifying the 1099 forms for Sutton to disguise his drug income. Following his arrest, in 2011, Sutton caused the co-conspirator to file a false affidavit with the Newport News Circuit Court where she falsely claimed the money seized belonged to her and was a loan to Sutton. As a result, the money was released to the co-conspirator for Sutton.

            This case was investigated by the Internal Revenue Service Criminal Investigations,  Newport News Police Department and ATF.  Assistant United States Attorney Howard J. Zlotnick is prosecuting the case on behalf of the United States.

Defendant Believed IED Was To Be Used In Murder

ALEXANDRIA, Va. – Vytlingum Kandasawmi, also known as Tony, 34, of Alexandria, Va., was sentenced today to 120 months in prison, followed by three years of supervised release, for selling an improvised explosive device (“IED”) believing that the device would be used to commit murder.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, and Lt. Col. Edwin C. Roessler, Jr., Acting Chief of the Fairfax County Police Department made the announcement after sentencing by United States District Judge Gerald Bruce Lee.

Kandasawmi previously pleaded guilty on March 26, 2013.  According to court documents, Kandasawmi and co-defendant Tony Robert Brooks, 51, of Spotsylvania County, Va., built and sold an IED to a man whom they believed intended to use the explosive device to murder a rival.  The IED was housed in PVC pipe and contained steel balls, black powder, and a fuse.  The bomb purchaser was, in fact, an undercover law enforcement agent, who had purchased several smaller bombs from Kandasawmi over the preceding months.  Brooks is scheduled to be sentenced on July 12, 2013.

This case was investigated by the FBI’s Washington Field Office and the Fairfax County Police Department.  Assistant United States Attorney Michael P. Ben’Ary prosecuted the case on behalf of the United States.

ALEXANDRIA, Va. – Edwin Barcus, Jr., age 27 and Joshua Dumas, also known as “Hitman,” age 21, both of Atlanta, Georgia, were sentenced today for conducting a Child Exploitation Enterprise.  Barcus was sentenced to 300 months in prison, followed by 5 years of supervised release.  Dumas was sentenced to 239 months in prison, followed by 5 years of supervised release.  Both defendants were also ordered to pay $ 177,050.23 in restitution.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Kenneth T. Cuccinelli, Attorney General of Virginia, Lieutenant Colonel Edwin C. Roessler, Jr., Acting Chief of the Fairfax County Police Department, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office made the announcement after the two defendants were sentenced by United States District Judges Leonie M. Brinkema and Gerald Bruce Lee.

            “These two defendants engaged in some of the most deplorable conduct imaginable: they abused, assaulted, and sexually exploited young girls for commercial profit up and down the Eastern seaboard,” said U.S. Attorney Neil H. MacBride.  “Given these heinous acts, my office and our law enforcement partners aggressively pursued Barcus and Dumas and charged them with conducting a ‘Child Exploitation Enterprise’ – a forceful statute – that mandates they each serve at least 20 years in prison.  Today’s sentences cannot erase the devastation caused by these felons, but it does ensure that they can no longer hurt our daughters and sisters and serves as a clear warning to all those who contemplate engaging in this despicable crime.”

            “These two men exploited adults and children alike, exposing them to a terrifying cycle of prostitution, violence, and intimidation,” said Attorney General Cuccinelli. “No one should have to endure the nightmare that these victims went through. It is our hope that today’s sentencing provides some peace to Barcus’s and Dumas’s victims as well as a warning to traffickers that we will find you and prosecute you to the fullest extent of the law.”

            “Today’s sentences demonstrate the resolve of law enforcement to put an end to the exploitation of children and the trafficking of humans,” said Assistant Director in Charge Parlave. “We will continue to take steps to dismantle sex trafficking enterprises such as this one, and ensure that individuals such as Mr. Barcus and Mr. Dumas pay for their deplorable actions.”

            Lt. Col. Edwin C. Roessler, Jr., Acting Chief of the Fairfax County Police Department, stated “Sex trafficking is a serious crime which will not be tolerated in Fairfax County and the Police Department will aggressively fight this crime to protect our great community. On behalf of our Department and community, we thank the United States Attorney for the Eastern District of Virginia for their partnership in combating sex trafficking with us in Fairfax County and nationally. This partnership will endure to continue making Fairfax County the safest place to live, work, and visit.”

            Barcus pleaded guilty on March 11, 2013, and Dumas pleaded guilty on March 18, 2013.   According to court documents, around 2007, Barcus founded an enterprise that prostituted at least seven minor girls and over twenty-three adults in at least seven states:  Virginia, Georgia, Florida, South Carolina, North Carolina, Maryland, and Tennessee.  Barcus and Dumas posted advertisements on Backpage.com and sex customers would meet the victims at hotels.  The venture had a litany of rules that the victims had to follow, including a rule that all of the money belonged to Barcus, Dumas, and the other pimps.  Barcus fractured the nose of one victim when she retained some of the money she had earned so that she could send it to the person caring for her infant child.  Yet another victim objected to being transported to Virginia to be prostituted; Dumas told that victim that she was his and that she had no choice but to be prostituted in Virginia.  Still another victim was struck by Dumas after she told him she wanted to go back to school.

To ensure compliance with their rules, Barcus and Dumas used force with some of the victims, drugged other victims with a substance known as “Molly,” and threatened still other victims.  Barcus, Dumas, and their co-conspirators also carried firearms to prevent competing pimps from “stealing” their girls.  Sometimes Barcus would contact prostitutes who were advertised on Backpage.com, attempt to recruit them, and if they refused, he would steal their money.  The venture frequently relocated to ensure a steady supply of customers and to avoid detection by the police.

This case was investigated by the Federal Bureau of Investigation and the Fairfax County Police Department.  Assistant United States Attorney Michael J. Frank and Virginia Assistant Attorney General and Special Assistant United States Attorney Marc J. Birnbaum prosecuted the case on behalf of the United States.

Barcus and Dumas were convicted of violating Title 18, United States Code, Section 2252A(g) “Child exploitation enterprises,” which imposes a mandatory minimum sentence of 20 years in prison for any who are convicted of being engaged in a child exploitation enterprise.  A child exploitation enterprise includes instances where an individual sexually traffics juveniles on three or more occasions, with three or more coconspirators, and involves more than one victim. 

ALEXANDRIA, Va. – Matthew James Addy, 34, of Lancaster, Penn., was sentenced today to 51 months in prison, followed by three years of supervised release, for running a $3.4 million Ponzi scheme that involved the fake purchase and resale of wholesale jewelry and loose precious stones.  Addy was also ordered to pay $2,741,321 in restitution to his victims and to forfeit to the government hundreds of thousands of dollars in jewelry. 

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing by United States District Judge James C. Cacheris.  Addy pleaded guilty to securities fraud charges on February 22, 2013.

            According to court records, Addy owned Edward J. & Company, which operated a retail jewelry store in Lancaster called La Porte Jewelers.  In 2010, Addy began recruiting individuals to invest in promissory notes purportedly linked to transactions involving wholesale jewelry and loose precious stones, which would be purchased through Addy’s businesses and resold to retail jewelers for a profit.  Addy ultimately recruited more than 40 investors from throughout the United States, including within the Eastern District of Virginia, and from Europe, and obtained nearly $3.4 million in invested funds.  Addy recruited many of the victim investors from within religious groups with which he was associated and used those affiliations to gain their trust—often referred to as “affinity fraud.” 

            The investment scheme was a fraud, Addy never conducted any of the contemplated wholesale jewelry transactions, and Addy used the vast majority of the invested funds on unrelated business and personal expenses and to support his comfortable lifestyle.

            Approximately $665,000 was paid back out to investors during the course of the fraud as supposed profits on their investments and was designed to conceal the fraud and induce further investments in the scheme.  Much of these payouts came directly from funds contributed by new investors, known as “Ponzi” payments.  

            This case was investigated by the FBI’s Washington Field Office.  Assistant United States Attorney Paul J. Nathanson prosecuted the case on behalf of the United States.

ALEXANDRIA, Va. – Melvin Mooring, 54, of Gainesville, Va., was sentenced today to 72 months in prison, followed by three years of supervised release, in connection with the theft of approximately $3.3 million from a Chantilly, Va., company where Mooring served as the chief financial officer.  Mooring was also ordered to pay $3,541,003.57 in restitution to his victims. 

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Kathryn Keneally, Assistant Attorney General for the Justice Department’s Tax Division; and Thomas J. Kelly, Special Agent in Charge, Washington, D.C. Field Office, IRS-Criminal Investigation, made the announcement after sentencing by United States District Judge Liam O’Grady.  Mooring pleaded guilty to wire fraud and tax evasion charges on March 8, 2013. 

            From 2000 to 2011, Mooring served as the chief financial officer, or CFO, of K&R Industries, a private company in Chantilly, Va.  According to court records, from 2004 to 2011, Mooring stole approximately $3.3 million from the company via company checks and wire transfers, which he routed through the bank account of a company he controlled in order to conceal their fraudulent nature.  Mooring also altered company financial statements to conceal the fraud.  Mooring used the funds for a luxurious home, travel, jewelry, and a BMW automobile, and to generally fund a comfortable lifestyle. 

            Mooring also failed to report the stolen funds as income on his individual income tax returns for the years 2005 through 2010, resulting in approximately $865,426 in losses to the United States Treasury.

            This case was investigated by IRS Criminal Investigation.  Assistant United States Attorney Paul J. Nathanson and Tax Division Trial Attorney Tracy L. Gostyla prosecuted the case on behalf of the United States. 

NORFOLK, Va. - Laquan Draper, 21, and Angelo Draper, 20, both of Portsmouth, Virginia, were sentenced today on charges stemming from a series of commercial robberies over an eight week period in the summer of 2011.  Laquan Draper was sentenced to 413 months and Angelo Draper was sentenced to 300 months for the conspiracy, robbery, and firearm convictions. 

            Neil H. McBride, United States Attorney for the Eastern District of Virginia, made the announcement after the sentences were handed down by Senior U.S. District Judge Robert G. Doumar. 

            During July and August of 2011, the Draper brothers engaged in an eight-week robbery spree spanning seven cities from Norfolk to Roanoke, Virginia.  They used stolen vehicles as getaway cars for most of the events, and searched for potential robbery sites using a stolen GPS.  The brothers concealed their identities ninja-style with black t-shirts tied around their faces and entered the business establishments usually between midnight and 4:00 a.m. armed with firearms or replica firearms. In most of the robberies, one brother would jump over the counter and the other would accost the clerk or store manager demanding money.  In some of the locations, the men threatened to shoot the clerks if they did not comply with demands to open the cash register or safe.  The men also robbed employees of two McDonald's Restaurants, a Wendy's Restaurant, a Fast Auto Loans location, and Got It Video Store in Norfolk.  At the video store, the Drapers and a third unidentified suspect shot out the business’s glass front door and entered through the bottom panel.  They then held customers and employees at gun-point and took money from the store registers. Laquan Draper was also convicted of attempting to rob an ABC Store in Norfolk on the morning of August 25, 2011, just a few hours before he and his brother were apprehended in Chesapeake after a harrowing high speed chase with Chesapeake Police, resulting in a head-on crash with a police vehicle.  Two Chesapeake detectives were injured as a result of the crash, and received treatment at a local hospital for non-life-threatening injuries.  Once the Draper brothers were removed from the stolen car, police recovered a .22 caliber hand-gun on the passenger floor board underneath Laquan Draper’s feet. Additional evidence recovered from the car was linked forensically to several of the crime scenes through shoe impressions, DNA, and fingerprint analysis.

            After hearing from over ninety prosecution witnesses in just two weeks, a federal jury convicted the Draper brothers on January 23, 2013, of conspiracy to commit robbery, multiple counts of commercial robbery, and discharging a firearm during a violent felony.  Laquan Draper was also convicted of possession of a firearm by a felon.   

            This case was investigated by the FBI, Appomattox County Sheriff’s Department, Chesapeake Police Department, Norfolk Police Department, Portsmouth Police Department, Roanoke City Police Department, Roanoke County Police Department, and Virginia Beach Police Department.  Additional assistance was provided by the Farmville County Sherriff’s Office and the Suffolk Police Department. Assistant United States Attorney Sherrie S. Capotosto and Special Assistant United States Attorney Amy E. Cross prosecuted the case on behalf of the United States.

NORFOLK, Va. – Omar Antonio Martinez, 31, of Sonora, Mexico, was sentenced today to 292 months in prison, followed by 5 years of supervised release, for his role in a large-scale cocaine trafficking organization.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia made the announcement after sentencing by Senior U.S. District Judge Robert G. Doumar.

Martinez pleaded guilty to conspiracy to distribute and possess with intent to distribute cocaine on October 17, 2012.  According to court documents, Martinez was a member of a cocaine distribution ring that extended from the Hampton Roads area to other locations throughout the United States.  In approximately 2006, Martinez approached several lower-level drug dealers in the area and recruited them to distribute cocaine on his behalf.  After selling the cocaine to multiple customers, the dealers would then provide the proceeds of these cocaine sales to Martinez, in order to purchase more cocaine.  At the time of his arrest in Hampton, Virginia, in May 2012, Martinez was found with 2.5 kilograms of cocaine, a kilogram press, digital scales, cocaine packaging materials, several thousand dollars, and a handgun.  All told, from 2006 through May 2012, Martinez was responsible for transporting, manufacturing, and distributing over 100 kilograms of cocaine throughout Tidewater. 
This case was investigated by the Drug Enforcement Administration and the Federal Bureau of Investigation.  Assistant United States Attorney V. Kathleen Dougherty prosecuted the case on behalf of the United States.

NORFOLK, Va. – Omega Protein, Incorporated (“Omega”) headquartered in Houston, Texas, with operations in Reedsville, Virginia, was sentenced today in United States District Court in Norfolk, Va. for two violations of the Clean Water Act stemming from its activities in the menhaden fishing industry.  Omega was sentenced to 3 years of probation and financial penalties totaling $7.5 million.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Otis E. Harris, Jr., Special Agent in Charge, Coast Guard Investigative Service, Chesapeake Region and David G. McLeod, Jr., Special Agent in Charge of the Environmental Protection Agency’s (EPA) Criminal Investigation Division, Philadelphia Area Office made the announcement after sentencing by U.S. District Judge Raymond A. Jackson.

            “Omega Protein’s conduct both harmed our environment and violated federal law,” said United States Attorney Neil H. MacBride.  “Today’s sentence, with its significant financial penalty, reflects the seriousness of these charges and our commitment to protecting the waterways of the Eastern District of Virginia.”

“The defendant put wildlife and aquatic life at risk in our nation's largest estuary by illegally discharging non-permitted fish processing waste and oily wastewater directly into the Chesapeake Bay and the Atlantic Ocean,” said Special Agent McLeod, who is in charge of EPA’s criminal enforcement program for the Middle Atlantic States.  “Today's sentence should serve as a strong deterrent and further demonstrates our resolve to vigorously prosecute those who despoil our natural resources by cutting corners and handling waste illegally.  We will continue to collaborate with the Coast Guard and other federal, state and local partners to investigate and prosecute those who violate our nation's environmental laws.”

            “As guardians of the maritime environment, the Coast Guard is charged with preserving our nation’s natural resources for future generations,” said Rear Admiral Steven Ratti, District Commander for the Fifth Coast Guard District.  “Our waterways are one of our nation’s greatest resources, and this case illustrates our commitment to work with our federal, state and local partners to ensure those who commit these types of crimes are held accountable.”

            Omega Protein, Inc., is a public company with stock traded on the New York Stock Exchange.  According to its website, Omega is one of the world’s leading producers of fish oil and the United States’ leading manufacturer of fish meal.  Omega’s products derive from menhaden, a small, oily, Omega-3 rich fish that live off the east coast of the United States. 

            According to court documents, from May 2008 through September 2010, Omega Protein violated the Clean Water Act through the operation of its fish processing facility in Reedsville, Va. and through the operation of its fishing fleet, also based in Reedsville.  Specifically, Omega’s processing facility generated a fish waste known as “Bail” water, the court records indicate.  This Bail water consisted of water mixed with fish waste and was permitted to be discharged at a point beyond three nautical miles from the shore, provided it was not mixed with any other chemicals or wastes.  According to the statement of facts filed with the Court, Omega combined the Bail water with pollutants generated by the processing operations and a caustic substance.  This material was then discharged into the Chesapeake Bay at a point less than three nautical miles from the shore.

The court records further reveal that from April 2009 through September 2010, Omega’s fishing fleet was operated in violation of the Clean Water Act.  Omega’s fishing fleet was configured in such a way that permitted the overboard discharge of oily wastewater directly into the sea.  The vessels contained pumps in the bilge that were connected directly to the skin of the ship so that the oily waste from the bilge could be pumped overboard.  The court records indicate it was the common practice for the Omega vessels to discharge oily wastewater in this manner while on their voyages.

            This case was investigated by agents from the Coast Guard Investigative Service and the Environmental Protection Agency Criminal Investigation Division.  Assistant United States Attorneys Joseph L. Kosky and Olivia Norman, and Special Assistant United States Attorney David Lastra prosecuted the case on behalf of the United States.

NORFOLK, Va. – William W. Lowery, IV, 44, of Tappahannock, Va., was sentenced to 30 days’ imprisonment today for violating the Lacey Act by trafficking in illegally-harvested striped bass.  After serving his sentence, Lowery will be placed on supervised release for one year.  Lowery is prohibited from engaging in the charter fishing industry in any capacity during the term of his supervised release.  Lowery was also sentenced to pay a $5,000 fine, pay $1,300 in restitution to the National Oceanic and Atmospheric Administration for the illegally-harvested striped bass, and surrender his Captain’s license for life.

Neil H. MacBride, U.S. Attorney for the Eastern District of Virginia, made the announcement after the sentence was pronounced by U.S. District Judge Henry C. Morgan, Jr.

            In a statement of facts filed with his plea agreement, Lowery admitted that on January 15, 2010, he took a charter fishing trip into the Exclusive Economic Zone (EEZ) to fish for Striped Bass, knowing that it was illegal to fish for Striped Bass in the EEZ. When Lowery’s boat, the Anna Lynn was approached by law enforcement, Lowery attempted to flee.  When the Anna Lynn was caught, law enforcement officers observed a plastic trash barrel with thirteen (13) Striped Bass floating in the water near the Anna Lynn. The trash barrel had been thrown overboard from the Anna Lynn during the pursuit, and the Striped Bass contained within the trash barrel had been harvested by fishermen aboard the Anna Lynn within the EEZ.

            This case was investigated by the National Oceanic and Atmospheric Administration, Fisheries, Office for Law Enforcement, and the Virginia Marine Police with assistance from the Federal Communications Commission Enforcement Bureau, Norfolk, Va. Office.  Trial Attorney James B. Nelson of the Department of Justice’s Environmental Crimes Section of the Environment and Natural Resources Division and Assistant U.S. Attorney Stephen W. Haynie from the Eastern District of Virginia are prosecuting the case on behalf of the United States.

NORFOLK, Va. – Brian Ray Dinning, formerly of Suffolk, Va., pleaded guilty today to one count of wire fraud and one count of bank fraud.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement after the plea was accepted by United States District Judge Raymond A. Jackson.

Dinning faces a maximum penalty of 30 years on the bank fraud charges and 20 years on the wire fraud charges when he is sentenced on October 2, 2013.

Dinning was a tax attorney in Suffolk, Virginia.  Dinning’s scheme to defraud involved South African investment opportunities, including land developments, gold and diamond mining operations, and alleged charitable work for the South African tribes.  Dinning orchestrated his scheme by soliciting local businessmen who were interested in investing in South Africa, either for charity or return on investments.  Dinning promised his investors guaranteed returns on their investments. 

Between 2005 and 2012, Dinning received over $2.5 million in investments and charitable donations to his numerous limited liability corporations (LLCs).  Dinning’s bank records reveal that shortly after the investment checks and wires were deposited into one of his LLC bank accounts, Dinning would immediately use the money to pay for personal expenses, such as a down-payment and subsequent mortgage payments on his new home; alimony/child support payments to his ex-wife; payments for credit cards balances; payments to disgruntled former investors; and payments to his wife and family members.  Dinning would periodically travel with his investors to South Africa to evaluate their investments.  As a result of these trips, several investors realized they had been defrauded and either asked for a return of their investment and/or filed lawsuits against Dinning.  Dinning eventually left the area after losing or settling several lawsuits, as well as losing his home in Suffolk.  Nevertheless, Dinning continued to recruit other victims in Maryland, Pennsylvania, Canada and Europe. 

In early 2012, Dinning became aware of the federal investigation concerning his projects and in May 2012, the defendant fled the United States and went to Toronto, Canada with his Canadian spouse.  Dinning was indicted in June 2012 on 25 counts of wire fraud. 

Dinning was indicted in September 2012, for defrauding Village Bank of Midlothian in 2005 and 2006.  In late 2005, Dinning purchased a 2005 Mercedes ML 500 and then obtained a $40,000 auto loan from Village Bank.  He filed for a new Virginia title that showed no liens on the car.  In May 2006, the defendant sold the car to his father in Pennsylvania for $26,000.  Dinning and his father showed this transaction as a gift, with the father and Dinning writing an affidavit of gift.  In May 2006, the defendant applied for a home mortgage of $828,000 with Village Bank.  Dinning falsified his mortgage application claiming $250,000 in income (he had been fired by his former employer, Trident, Inc., in Northern Virginia, in January 2006); he provided the bank falsified 2004 and 2005 tax returns; and misled the bank regarding his alimony or child support.  Village Bank’s losses were approximately $223,000 on the two loans. 

Dinning eventually was extradited from Canada on December 20, 2012, and was held for pretrial detention pending trial. This case was investigated by the Federal Bureau of Investigation.  Assistant United States Attorneys Stephen W. Haynie and Elizabeth M. Yusi are prosecuting the case on behalf of the United States.

ALEXANDRIA, Va. – Brita Lanette Jackson, 51, of Winchester, Va., was convicted today following a June 4, 2013, bench trial on charges of making a false statement in connection with the purchase of a firearm and conspiracy to aid and abet a convicted felon in the possession of firearms.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and Carl J. Vasilko, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division made the announcement after the verdict was pronounced by United States District Judge James C. Cacheris.
Jackson faces a maximum penalty of ten years of incarceration when she is sentenced on September 20, 2013. 
Jackson was indicted on March 27, 2013, by a federal grand jury on charges of making a false statement in connection with the purchase of a firearm and conspiracy to aid and abet a convicted felon in the possession of firearms.  According to court records and evidence at trial, Jackson was observed by ATF agents on May 24, 2012, as she purchased an AK-47 style assault pistol from a firearms dealer in Manassas, Virginia. Jackson had indicated on official paperwork that the firearm was for her, but she in fact intended to transfer the weapon to a convicted felon that accompanied her to the store.  Federal agents discovered an additional firearm, ammunition, and evidence of several firearms purchases during a search of Jackson’s residence in Winchester, Virginia.  The firearms included high-capacity handguns and a Cobray Mac-11 pistol.  Jackson admitted that she purchased between 15 to 20 firearms on behalf of the same convicted felon and that she did not know how that felon was utilizing the firearms.
This case was investigated by ATF’s Washington Field Division.  Assistant United States Attorney Adam B. Schwartz is prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

NORFOLK, Va. – Timothy Thomas Robinson, 33, of Virginia Beach, Va., was sentenced today to 120 months in prison, followed by lifetime supervised release, for possession of child pornography.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia made the announcement after sentencing by U.S. District Judge Mark S. Davis.
Robinson pleaded guilty on March 21, 2013.  According to court documents, Robinson was originally convicted for child pornography violations by the City of Norfolk in 2005.  Robinson again was convicted for similar violations in Norfolk in 2007.  In January 2012, the Virginia Beach Police Department arrested Robinson for subsequent probation violations, and he was found to be in possession of numerous images of child pornography which he downloaded with his cellular phone from the Internet.
This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov. 

           This case was investigated by the Virginia Beach Police Department.  Assistant United States Attorney Elizabeth M. Yusi prosecuted the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

ALEXANDRIA, Va. – Andy Persaud, 40, of Ashburn, Va., was sentenced today to 24 months in prison, followed by three years of supervised release, for defrauding the Bank of Georgetown  by obtaining a $1,000,000 line of credit on the basis of false documentation, and for obstructing justice by destroying and falsifying evidence in response to an investigative subpoena issued by the General Services Administration (GSA) Office of Inspector General.  Persaud was also ordered to pay over $720,000.00 in restitution.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Valerie Parlave, Assistant Director in Charge of FBI’s Washington Field Office, and Brian D. Miller, General Services Administration (GSA) Inspector General, made the announcement after sentencing by United States District Judge Claude M. Hilton
Persaud pleaded guilty on March 14, 2013. According to court documents, Persaud, who founded and owned PCI construction company, submitted fraudulent documents on multiple occasions to the Bank of Georgetown in order to obtain increased lines of credit and loans on that line of credit.  Persaud went so far as to completely fabricate unpaid invoices related to PCI government contracts as collateral for the loans.  In certain instances, moreover, PCI submitted government contract invoices to the Bank of Georgetown before PCI was actually awarded the contract.  These false and fraudulent invoices, submitted at Persaud’s direction, caused the Bank of Georgetown to suffer more than $700,000 in actual losses. 
In addition to his bank fraud, Persaud separately obstructed justice in connection with a GSA investigation into whether Persaud and PCI had violated the Federal False Claims Act in its government contracting practices.  In response to an administrative subpoena, Persaud once again provided altered and fabricated documents—this time in attempt mislead government investigators.  For example, Persaud instructed his employees to submit falsified job cost estimates and subcontractor proposals, and he personally added handwritten notes to some of the documents in an attempt to hide his unlawful government contracting practices that were the subject of the investigation.  Despite knowing that the documents he submitted to the GSA were fabricated, Persaud falsely certified to the GSA that he and PCI had complied with the subpoena.  
This case was investigated by GSA Office of Inspector General and the FBI’s Washington Field Office. Assistant United States Attorneys Charles Connolly and Chad I. Golder prosecuted the case on behalf of the United States.

RICHMOND, Va. – From February 19, 2013, to April 22, 2103, federal, state, and local law enforcement in Richmond, Va. and surrounding counties, executed 17 search warrants and made six arrests in an operation known as “Spring Clean.”

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Jeffrey C. Mazanec, Special Agent in Charge of the Federal Bureau of Investigation, Richmond Division; Timothy J. Heaphy, United States Attorney for the Western District of Virginia; Chief Ray J. Tarasovic, City of Richmond Police Department; Colonel W. Steven Flaherty, Virginia State Police; Colonel Thierry Dupuis, Chesterfield County Police Department; Colonel David R. Hines, Hanover County Sheriff’s Office; Chief Douglas A. Middleton, Henrico County Police Division; Chief Timothy J. Longo, Charlottesville Police Department; Special Agent in Charge John P. Torres of the Department of Homeland Security, Homeland Security Investigations; Inspector in Charge Keith A. Fixel, U.S. Postal Inspection Service, Charlotte Division; and Attorney General Kenneth T. Cuccinelli, Virginia Attorney General’s Office, made the announcement after the multi-month operation was executed.  Operation “Spring Clean” focused on the interdiction of crimes against children; specifically child pornography and child enticement type offenses. 

Operation Spring Clean arose out of cooperative effort among multiple law enforcement agencies in the greater Richmond metropolitan area.  Investigations into the sexual exploitation of children committed via the internet and facilitated through technology have increased each year.  As a result of this increase, two taskforces have formed over the years, the FBI Child Exploitation Taskforce (CETF) and the Internet Crimes Against Children (ICAC) Taskforce.  It is through these two taskforces that federal, state, and local law enforcement agencies have formed partnerships and collaborated on these predatory internet investigations.

            While conducting an investigation into the distribution of child pornography initiated by the City of Richmond Police Department, multiple targets were identified, within the greater Richmond metropolitan area, as distributing a large quantity of prepubescent child pornography depicting children ranging from infancy to 11 years of age.  The sheer number of targets was concerning, as was the age of the children in the material they were distributing.  After these incredibly troubling revelations, it was decided that the best course of action was to combine the efforts of the ICAC Taskforce and the FBI CETF in order to target these offenders, as well as others located across the Commonwealth of Virginia.  Spring Clean became the name of the operation as law enforcement “cleaned,” or apprehended, a large number of alleged internet predators that would have normally taken months to accomplish, but through this coordination, was able to be done in a matter of days.

The following law enforcement agencies participated in the operation:

• Charlottesville Police Department
• Chesterfield County Police Department
• Federal Bureau of Investigation, Richmond Division
• Hanover County Sheriff’s Office
• Henrico County Police Division
• Department of Homeland Security, Homeland Security Investigations, Richmond Division
• City of Richmond Police Department
• U.S. Postal Inspection Service, Charlotte Division
• Virginia State Police
• The U.S. Attorney’s Office for the Eastern District of Virginia
• The U.S. Attorney’s Office for the Western District of Virginia
• The Virginia Attorney General’s Office

Search warrants were executed in the following localities: Bath, Chesterfield, Clifton Forge, Hanover, Henrico, Prince George, Richmond, and Weyers Cave. 
Those arrested during the operation include:

• Brian McMahon Connell, 47, of Chesterfield, Virginia.  Subsequent to his arrest, Connell was indicted on three federal charges of distribution of child pornography and is scheduled to stand trial in United States District Court in Richmond, Virginia on July 8, 2013. 

• Robert Warren Louis Kropp, 26, of Colonial Heights, Virginia.  Subsequent to his arrest, Kropp pleaded guilty on May 7, 2013, to the federal charge of coercion and enticement of a minor.  He will be sentenced in United States District Court in Richmond, Virginia on August, 2, 2013.

• Guy Matthew Lotz, 28, of Weyers Cave, Virginia.  Subsequent to his arrest, Lotz was indicted on a charge of distribution of child pornography in the Western District of Virginia.  He is scheduled to stand trial on this federal charge on August 12, 2013.

• Harry Lee Palmquist, Jr., 45, of Chesterfield, Virginia.  Subsequent to his arrest, Palmquist was indicted on three federal charges of distribution of child pornography.  He is scheduled to stand trial in United States District Court in Richmond, Virginia on July 16, 2013.

• William Michael Stravitz, 48, of Richmond, Virginia.  Subsequent to his arrest, Stravitz pleaded guilty to three state felony distribution of child pornography charges.  He will be sentenced in Richmond Circuit Court.

• Brent Thomas Wilson, 31, of Midlothian, Virginia. Subsequent to his arrest, Wilson was charged with three counts of distribution of child pornography and three counts of possession of child pornography by the Chesterfield Commonwealth’s Attorney’s Office.  He is scheduled to appear in Chesterfield Juvenile and Domestic Relations Court in September 2013. 

Criminal complaints, arrests, and indictments are only charges and not evidence of guilt. A defendant is presumed to be innocent until and unless proven guilty.

ALEXANDRIA, Va. – Christopher M. Adkins, 36, of Aurora, Ill., pleaded guilty today to felony criminal copyright infringement, in connection with his sale of counterfeit copies of Rosetta Stone language-learning software. 

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Acting Assistant Attorney General Mythili Raman for the Criminal Division of the U.S. Department of Justice, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the plea was accepted by United States District Judge Gerald Bruce Lee. 

Adkins’s sentencing has been scheduled for September 13, 2013, when he will face a maximum sentence of five years in prison and a $250,000 fine.

According to court documents, over more than three years, Adkins sold more than $100,000 in copyright-infringing computer software.  He sold the software through the Internet website Learningpartners.mybisi.com operated from his home in Aurora.

Adkins admitted that he downloaded pirated versions of Rosetta Stone language-learning products, including Spanish, Russian, Hebrew, Italian, German, and Korean, and then would copy the programs onto compact discs; he would then sell the discs to online customers for prices more than 50 percent of the manufacturer’s suggested retail price for legitimate product.  Mr. Adkins admitted he made at least $100,000 as part of his scheme.  

            The case was investigated by Federal Bureau of Investigation’s Washington Field Office. 

Senior Counsel Thomas Dougherty of the Computer Crime & Intellectual Property Section of the Criminal Division of the U.S. Department of Justice and Assistant United States Attorney Jay Prabhu prosecuted the case on behalf of the United States.

ALEXANDRIA, Va. –William P. Danielczyk Jr. was sentenced today to 28 months in prison and ordered to pay a $50,000 fine for illegally reimbursing $186,600 in contributions to the Senate and Presidential campaign committees of a candidate for federal office and then obstructing the subsequent law enforcement investigation.

U.S. Attorney Neil H. MacBride of the Eastern District of Virginia, Acting Assistant Attorney General Mythili Raman of the Criminal Division, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office made the announcement after sentencing by U.S. District Judge James C. Cacheris in the Eastern District of Virginia.

On Feb. 26, 2013, Danielczyk, 51, and Eugene R. Biagi, 78, both of Oakton, Va., pleaded guilty to making illegal conduit campaign contributions. Biagi was sentenced to two years’ supervised probation for his role in Danielczyk’s scheme.

According to court records, Danielczyk was the chairman of Galen Capital Corporation, and Biagi served as the corporation’s secretary. In September 2006, Danielczyk co-hosted a fundraiser for a candidate’s campaign for the U.S. Senate and in March 2007 he co-hosted a fundraiser for the same candidate’s 2008 campaign for the President of the United States.

Danielczyk admitted that he recruited individuals, including Biagi and other corporate employees, to serve as “straw donors” to the campaigns, assuring the donors that they would be reimbursed for their contributions. Danielczyk’s assistant collected the contributions, and Danielczyk and Biagi then reimbursed the straw donors for their contributions using Galen Capital Corporation’s corporate funds.

Biagi admitted that he disguised the nature of the reimbursement payments by falsely identifying the purpose of the reimbursement checks on the memorandum line of the check itself and by issuing the checks for amounts slightly larger than the campaign contributions. As part of the obstruction scheme, Danielczyk directed the creation of back-dated letters addressed to individual contributors, which falsely characterized the reimbursement payments to them as “consulting fees.”  One set of the letters contained a check for $1,500 in order to further the charade that the reimbursement checks were consulting fees.  Biagi furthered the scheme by, among other means, signing the back-dated letters and the checks, thereby supporting Danielczyk’s aims at covering up the true conduct and obstructing the investigations focused on the reimbursement scheme.

Danielczyk and Biagi admitted they used corporate funds to reimburse a total of $186,600 to the two campaigns. The campaigns unwittingly reported them as lawful contributions from the individual “straw donors.”

This case was investigated by the FBI’s Washington Field Office. Assistant U.S. Attorneys Mark D. Lytle and Timothy D. Belevetz from the U.S. Attorney’s Office for the Eastern District of Virginia and Trial Attorney Eric L. Gibson of the Criminal Division’s Public Integrity Section prosecuted the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

ALEXANDRIA, Va. – Total, S.A., a French oil and gas company that trades on the New York Stock Exchange, has agreed to pay a $245.2 million monetary penalty to resolve charges related to violations of the Foreign Corrupt Practices Act (FCPA) in connection with illegal payments made through third parties to a government official in Iran to obtain valuable oil and gas concessions, announced U.S. Attorney Neil H. MacBride for the Eastern of Virginia, and Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.

As part of the agreed resolution, the department today filed a criminal information in U.S. District Court for the Eastern District of Virginia charging Total with one count of conspiracy to violate the anti-bribery provisions of the FCPA, one count of violating the internal controls provision of the FCPA, and one count of violating the books and records provision of the FCPA.  The department and Total agreed to resolve the charges by entering into a deferred prosecution agreement for a term of three years.

Also today, the U.S. Securities and Exchange Commission (SEC) entered into a cease-and-desist order against Total in which the company agreed to pay an additional $153 million in disgorgement and prejudgment interest.  Total also agreed with the SEC to comply with certain undertakings regarding its FCPA compliance program, including the retention of a compliance consultant.

In addition, French enforcement authorities announced earlier today that they had requested that Total, Total’s Chairman and Chief Executive Officer, and two additional individuals be referred to the Criminal Court for violations of French law, including France’s foreign bribery law.

“The Eastern District of Virginia, through our strong partnership with the Criminal Division’s Fraud Section, is committed to holding accountable those who violate the Foreign Corrupt Practices Act,” said U.S. Attorney MacBride.  “Today’s deferred prosecution agreement, with both its punitive and forward-looking compliance provisions, dovetails with our goals of bringing violators to justice and preventing future misconduct.”

“Today we announce the first coordinated action by French and U.S. law enforcement in a major foreign bribery case,” said Acting Assistant Attorney General Raman.  “Our two countries are working more closely today than ever before to combat corporate corruption, and Total, which bought business through bribes, now faces the criminal consequences across two continents.”

According to the deferred prosecution agreement, in 1995 Total sought to re-enter the Iranian oil and gas market by attempting to obtain a contract with the National Iranian Oil Company (NIOC) to develop the Sirri A and E oil and gas fields.  In May 1995, Total entered into negotiations with an Iranian official who served as the Chairman of an Iranian state-owned and state-controlled engineering company.  Total subsequently entered into a purported consulting agreement pursuant to which Total would corruptly make payments to an intermediary designated by the Iranian official to secure NIOC signing a development agreement with Total for the Sirri A and E project, which NIOC did in July 1995.  Over the next two-and-a-half years, Total paid approximately $16 million in bribes under the purported consulting agreement.

In 1997, Total sought to negotiate a contract with NIOC to develop a portion of the South Pars gas field, the world’s largest gas field.  At the direction of the Iranian official, Total and a second intermediary entered into another purported consulting agreement that called for Total to make large payments to the intermediary.  In September 1997, Total executed a contract with NIOC that granted it a 40 percent interest in developing phases two and three of the South Pars gas field.  Over the next seven years, Total made unlawful payments of approximately $44 million pursuant to the second purported consulting agreement.

In sum, between 1995 and 2004, at the direction of the Iranian official, Total corruptly made approximately $60 million in bribe payments under the agreements for the purpose of inducing the Iranian official to use his influence in connection with Total’s efforts to obtain and retain lucrative oil rights in the Sirri A and E and South Pars oil and gas fields.  Total mischaracterized the unlawful payments as “business development expenses” when they were, in fact, bribes designed to corruptly influence a foreign official.  Further, Total failed to implement effective internal accounting controls, permitting the consulting agreements’ true nature and true participants to be concealed and thereby failing to maintain accountability for assets.

In addition to the monetary penalty, Total also agreed to cooperate with the department and foreign law enforcement, to retain an independent corporate compliance monitor for a period of three years, and to continue to implement an enhanced compliance program and internal controls designed to prevent and detect FCPA violations. 

The case is being prosecuted by Trial Attorney Andrew Gentin of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Charles Connolly of the U.S. Attorney’s Office for the Eastern District of Virginia.  Significant assistance was provided by the Criminal Division’s Office of International Affairs and by the SEC’s New York Regional Office.  The department also acknowledges and expresses its deep appreciation for the cooperation and partnership of French law enforcement authorities. 

Additional information about the Justice Department’s FCPA enforcement efforts can be found at www.justice.gov/criminal/fraud/fcpa.

ALEXANDRIA, Va. – James Douglas Manring, 54, of Fredericksburg, Virginia, was sentenced today to 168 months in prison, followed by a 3 year term of supervised release, for production of child pornography.  Prior to his arrest on Nov. 13, 2012, Manring taught preschool in Bethesda, Maryland.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia and Gary Barksdale, Inspector in Charge of the Washington Division of the United States Postal Inspection Service, made the announcement after United States District Court Judge Claude M. Hilton imposed sentencing. 

Manring pleaded guilty to two counts of production of child pornography on Jan. 28, 2013.
According to court documents, Manring filmed himself performing sexual acts on several students who were approximately five years of age while teaching at a preschool in Japan from 1996 to 1999.  In 1999, Manring returned to the United States and brought DVDs containing the child pornography he produced with him.

            Further, between April 2010 and February 2011, Manring also purchased approximately 46 videos for about $2,000.  These videos depict the graphic and simulated lascivious exhibition of the genitals and pubic areas of minor boys and were mailed from New York to Manring’s residence in Fredericksburg, Virginia.

This case was investigated by the US Postal Inspection Service, Child Exploitation Investigations’ Washington Division.  Special Assistant United States Attorney Alicia J. Yass, a Trial Attorney with the Child Exploitation and Obscenity Section of the Justice Department’s Criminal Division, is prosecuting the case on behalf of the United States.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

NORFOLK, Va. – Following a multi-week trial, three top executives and a favored borrower have been convicted by a federal jury in Norfolk, Va.  Accused of masking non-performing assets at the Bank of the Commonwealth for their own personal benefit and to the detriment of the Bank, this long-running scheme contributed to the failure of the Bank in 2011, costing the Federal Deposit Insurance Corporation (FDIC) an estimated $268 million.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Royce E. Curtin, Special Agent in Charge of the FBI’s Norfolk Field Office; Thomas J. Kelly, Special Agent in Charge of the Internal Revenue Service Criminal Investigation’s Washington, D.C., Field Office (IRS-CI); Christy L. Romero, Special Inspector General for the Troubled Asset Relief Program (SIGTARP); Jon T. Rymer, Inspector General of the Federal Deposit Insurance Corporation (FDIC-OIG); and Mark Bialek, Inspector General of the Board of Governors of the Federal Reserve System and Consumer Financial Protection Bureau (FRB-CFPB OIG) made the announcement.

“The brazen greed and dishonesty of these four defendants toppled one of Virginia’s largest financial institutions and intensified the impact of the 2008 financial crisis on the public during the height of the fiscal storm,” said U.S. Attorney Neil H. MacBride.  “Today’s verdict sends a clear message to top executives and insiders in the financial services industry that those entrusted with the health of our financial institutions will be held accountable when they violate that trust.”

            “Today, those responsible for the corruption leading to one of the biggest bank failures in Virginia history impacting our Hampton Roads community were held accountable,” said FBI Special Agent In Charge Royce E. Curtin.  “The extensive two year investigation led by FBI Norfolk Division, in conjunction with IRS, SIGTARP, FDIC-OIG, and FRB-CFPB OIG, identified and unraveled a criminal enterprise conducting complex fraudulent financial transactions. This case reflects the FBI and its partners' commitment to protect our communities by aggressively investigating and bringing to justice individuals exploiting their influence or position for personal gain.”

            “Today's conviction is a reminder that IRS Criminal Investigation is committed to unraveling complex financial transactions of individuals who scheme to defraud U.S taxpayers,” said Thomas J. Kelly, Special Agent in Charge, IRS Criminal Investigation, Washington DC Field Office. “We will continue to work with our law enforcement partners to protect the integrity of our financial system.”

             "Today's verdict shows that the same rules apply to bank executives as to any other citizen, and the verdict should stand as a warning to anyone engaged in fraud related to TARP; you will be held accountable and brought to justice for your crimes," said Christy Romero, Special Inspector General for TARP (SIGTARP).  "Edward Woodard and other senior executives at Bank of the Commonwealth and their network of co-conspirators cultivated a culture of deceit and corruption at the bank, exchanging personal favors and lining their pockets while defrauding customers, shareholders, and federal regulators and driving the bank into the ground.  The selfishness required to engage in such a fraud with the expectation that taxpayers and members of the community would clean up the mess is both legally and morally offensive.  I would like to commend U.S. Attorney MacBride and the Assistant U.S. Attorneys for their exceptional work prosecuting the case."

“The Federal Deposit Insurance Corporation (FDIC) Office of Inspector General is pleased to join our law enforcement colleagues in bringing these individuals to justice,” said FDIC Inspector General Jon T. Rymer.  “We applaud the efforts of the U.S. Attorney’s Office, its staff, and the special agents who worked this lengthy, complex investigation and trial.  We especially appreciate the willingness of the Eastern District of Virginia to devote the time and resources needed to bring this case to trial.   This case involves the largest bank failure in the Commonwealth of Virginia—one that caused more than $268 million in  losses to the FDIC’s Deposit Insurance Fund and harmed people and businesses in the Tidewater, Virginia community.  We are particularly concerned when individuals occupying positions of trust in a bank abuse their positions, conspire with others, and engage in criminal activities.  We will continue to pursue such offenders in the interest of maintaining the integrity of our nation's banks and protecting the Deposit Insurance Fund.”

“Our office is committed to bringing to justice bank executives who engage in illegal activities that undermine the public trust,” said Mark Bialek, Inspector General of the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau.  “We will continue to work with our law enforcement partners to vigorously pursue wrongdoers whose fraudulent actions materially impact the Federal Reserve Board’s supervision program.”

Edward J. Woodard, 70, served as the Bank’s chief executive officer and chairman of the board for more than three decades until he was forced to step down as chairman and ultimately  retire from the Bank in December 2010, was convicted of conspiracy to commit bank fraud, bank fraud, false entry in a bank record, unlawful participation in a loan, and false statement to a financial institution.   He is scheduled to be sentenced on Sept. 26, 2013.  Each charge carries a maximum penalty of 30 years in prison. 

Stephen G. Fields, 49, served as an executive vice president and commercial loan officer until he was terminated in December 2010. Fields was convicted of conspiracy to commit bank fraud, false entry in a bank record, false statement to a financial institution, and misapplication of bank funds.  He is scheduled to be sentenced on Sept. 16, 2013.  Each charge carries a maximum penalty of 30 years in prison. 

Troy Brandon Woodard, 36, the son of CEO Edward Woodard, was employed by a wholly-owned subsidiary of the Bank as a vice president and mortgage loan specialist until he was terminated in January 2011. Brandon Woodard was convicted of conspiracy to commit bank fraud and unlawful participation in a loan.  He is scheduled to be sentenced on Sept. 30, 2013.  Each charge carries a maximum penalty of 30 years in prison. 

Dwight A. Etheridge, 48, a favored borrower, owned and operated a residential and commercial development company, as well as an employment staffing company. Etheridge was convicted of conspiracy to commit bank fraud, misapplication of bank funds, and false statement to a financial institution.  He is scheduled to be sentenced on September 18, 2013.  Each charge carries a maximum penalty of 30 years in prison.

According to the evidence adduced at trial, in 2006, leaders at the Bank of the Commonwealth began an aggressive expansion to take the Bank beyond its traditional focus area of Norfolk and Virginia Beach to include branches in northeastern North Carolina and the Outer Banks. By December 2009, the Bank’s assets reached approximately $1.3 billion.  These assets were built largely through brokered deposits.  Brokered deposits are a financial tool that allows investors to pool their money and receive higher rates of return. Because of the high-volatility of these deposits, an institution must remain well-capitalized to accept and renew brokered deposits.

Evidence showed that many of the Bank’s loans were funded and administered without regard to industry standards or the Bank’s own internal controls.  By 2008, the volume of the Bank’s troubled loans and foreclosed real estate soared. From 2008 through 2011, Bank insiders – Edward Woodard and Fields – masked the Bank’s true financial condition out of fear that the Bank’s declining health would negatively impact investor and customer confidence and affect the Bank’s ability to accept and renew brokered deposits.

To fraudulently hide the Bank’s troubled assets, these Bank insiders overdrew demand deposit accounts to make loan payments, used funds from related entities – at times without authorization from the borrower – to make loan payments, used change-in-terms agreements to make loans appear current, and extended new loans or additional principal on existing loans to cover payment shortfalls.

In addition, the evidence showed that Bank insiders also provided preferential financing to troubled borrowers to purchase Bank-owned properties. The troubled borrowers were already having difficulty making payments on their existing loans; however, the financing allowed the Bank to convert a non-earning asset into an earning asset, and the troubled borrowers obtained cash at closing to make payments on their other loans at the Bank or for their own personal purposes. The troubled borrowers purchased or attempted to purchase property owned by Bank insiders and Brandon Woodard.  These real estate loans were fraudulently funded by the Bank.

The evidence also established that in late 2008, Edward J. Woodard caused the Bank to pay approximately $100,000 in fraudulent invoices purportedly for the Bank’s Suffolk branch when in fact they were for renovations at the personal residence of Troy Brandon Woodard.

 In November 2008, the Bank of the Commonwealth submitted to the Federal Reserve, an application requesting approximately $28 million from the Troubled Asset Relief Program (TARP).  Based on its regulator's concerns about the health of the Bank, the Federal Reserve later requested that the Bank withdraw its TARP application, which the Bank did.

From 2008 up to its closing in 2011, the Bank lost nearly $115 million. It is estimated that the Bank’s failure cost the federal government, through the deposit insurance fund, approximately $268 million.

Simon Hounslow, 48, served as an executive vice president and chief lending officer until the Bank closed in September 2011. Hounslow was acquitted of all charges.

            The investigation was conducted by the FBI’s Norfolk Field Office, IRS-CI, SIGTARP, FDIC-OIG, and FRB-CFPB OIG.  Assistant United States Attorneys Melissa E. O’Boyle, Katherine Lee Martin, and Uzo Asonye are prosecuting the case on behalf of the United States.

The investigation has been coordinated by the Virginia Financial and Securities Fraud Task Force, an unprecedented partnership between criminal investigators and civil regulators to investigate and prosecute complex financial fraud cases in the nation and in Virginia. The task force is an investigative arm of the President’s Financial Fraud Enforcement Task Force, an interagency national task force.

President Obama established the Financial Fraud Enforcement Task Force to wage an aggressive, coordinated and proactive effort to investigate and prosecute financial crimes.  The task force includes representatives from a broad range of federal agencies, regulatory authorities, inspectors general, and state and local law enforcement who, working together, bring to bear a powerful array of criminal and civil enforcement resources. The task force is working to improve efforts across the federal executive branch, and with state and local partners, to investigate and prosecute significant financial crimes, ensure just and effective punishment for those who perpetrate financial crimes, combat discrimination in the lending and financial markets, and recover proceeds for victims of financial crimes.

ALEXANDRIA, Va. – The owner of an investment company pleaded guilty today for his role in an investment scheme involving false promises, announced U.S. Attorney for the Eastern District of Virginia Neil H. MacBride and Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division.

David Eugene Howard II, 33, of Queens Village, N.Y., pleaded guilty before U.S. District Judge T. S. Ellis III in the Eastern District of Virginia to one count of mail fraud. 

According to the plea documents, from in or about March 2008 through in or about April 2009, Howard falsely represented to investors that his company, Flatiron Systems, LLC, traded pooled equity accounts using a proprietary trading system called “Pathfinder.” Through distributing false and misleading letters, operating agreements, account statements, and other materials, he caused investors to send investments of at least $5,000, which were deposited into an account that he exclusively controlled and which he later misappropriated for his own benefit and the benefit of others.

Over the course of his scheme, Howard directly misappropriated approximately $373,000 of $1.8 million in investor funds.  Howard’s misappropriation included approximately $86,000 in transfers to his personal bank account, cash withdrawals, and personal expenditures made with his company debit card, to include approximately $34,500 in charges at a night club and approximately $3,600 in charges towards the purchase of a Tiffany necklace for Howard’s girlfriend at the time.

According to court documents, in December 2008, Howard falsely informed investors that trading had been voluntarily halted so that an independent audit could be performed. Nonetheless, Howard continued to transfer approximately $26,500 in investor funds to his personal bank account, along with additional cash withdrawals and personal expenditures over the course of the following four months.  Howard followed up with another letter which falsely advised investors of prolonged audit and tax procedures, which his nonexistent attorneys and accountants were purportedly diligently working on.

At sentencing, Howard faces a maximum penalty of 20 years in prison, a fine of $250,000 or twice the gross gain or loss, and full restitution.  Sentencing is scheduled for Sept. 20, 2013.

In a related action, the U.S. Securities and Exchange Commission (SEC) filed a civil enforcement action against Howard on March 21, 2011.

Unlawfully Obtained $4.4 Million In Contracts Intended For Disadvantaged Small Businesses

ALEXANDRIA, Va. – Michael Brian Dunkel, 59, of Merritt Island, Fl., pleaded guilty today to fraudulently obtaining more than $4.4 million in government contract payments that should have gone to disadvantaged small businesses.
Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Acting Assistant Attorney General Mythili Raman of the Justice Department’s Criminal Division; National Aeronautics and Space Administration (NASA) Inspector General Paul K. Martin; Small Business Administration (SBA) Inspector General Peggy E. Gustafson; Defense Criminal Investigative Service (DCIS) Special Agent in Charge of Mid-Atlantic Field Office Robert E. Craig; General Services Administration (GSA) Inspector General Brian D. Miller; and Department of Homeland Security (DHS) Deputy Inspector General Charles K. Edwards made the announcement after the plea was accepted by United States District Judge Claude M. Hilton.
Dunkel was charged by criminal information on May 23, 2013, with one count of major government fraud. Dunkel faces a maximum penalty of 10 years in prison when he is sentenced on October 4, 2013. As part of his plea agreement, Dunkel has agreed to forfeit $2.9 million.
According to court documents, Dunkel admitted that in 2005, he learned that Keith Hedman, an executive at an Arlington-based security service consulting company referred to as Company A in court records, illegally controlled Company B, another Arlington-based security service consulting company. Company B was a participant in the SBA “Section 8(a)” program, which enables certain small businesses to receive sole-source and competitive-bid contracts set aside for minority-owned and disadvantaged small businesses. Although Hedman controlled Company B, Company B had obtained its 8(a) status based on the disadvantaged status of Dawn Hamilton, its nominal owner.
Dunkel admitted that he agreed to pay Hedman and Company B a fee in exchange for Company B allowing Dunkel to use its 8(a) status to obtain NASA and other U.S. government contracts. Although Company B was required to perform at least 50% of the work on the contracts and had represented it would do so, no Company B employees actually performed any work. Instead, Dunkel and others did all of the work as independent contractors, but they concealed that fact from the government agencies. In addition, Dunkel submitted fraudulent proposals and invoices to hide their scheme, used a third-party company’s Federal Employer Identification Number to prevent reporting of his contractor income to the IRS, and did not pay any income taxes on the income he received from Company B.
Seven defendants, including Hedman and Hamilton, have previously pleaded guilty in connection with the government contracting fraud scheme and a related bribery scheme.
This case is being investigated by NASAOffice of the Inspector General (OIG), the SBA -OIG, DCIS-OIG, GSA-OIG, DHS-OIG, and with assistance from the Defense Contract Audit Agency.  Assistant U.S. Attorneys Chad Golder and Ryan Faulconer, a former Trial Attorney for the Criminal Division’s Fraud Section, are prosecuting the case on behalf of the United States.
A copy of this press release may be found on the website of the United States Attorney’s Office for the Eastern District of Virginia at http://www.justice.gov/usao/vae. Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on https://pcl.uscourts.gov.

ALEXANDRIA, Va. – Amy Hunter, age 27, of Longview, Washington, was sentenced today  to 102 months in prison, followed by three years of supervised release, for the murder of a nine-month-old baby that was in her care.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia and Michael T. Monroe, Special Agent In Charge Naval Criminal Investigative Service (NCIS) made the announcement after sentencing by United States District Judge Anthony J. Trenga.

            Hunter previously pleaded guilty on January 16, 2013.

            According to court documents, the defendant admitted that on April 26, 2011, in her home on the Quantico United States Marine Corps Base, she murdered C.P., a child of nine- months-of-age.  The defendant had been providing daily care for C.P. and the defendant’s own daughter in her home on Quantico Marine Base which she shared with her husband, an active-duty Marine.

            The court documents further state that at approximately 9:23 a.m., Hunter placed a 911 call reporting that C.P. had hit her head and lost consciousness. C.P. was airlifted to Inova Fairfax Hospital where she was placed on life support.  C.P. had severe traumatic brain injuries, including cerebral edema, subdural hemorrhages, numerous occipital fractures, and significant, diffuse retinal hemorrhages. The hospital also identified a healing rib fracture that they believed was more than three weeks old. 

            C.P. never regained consciousness and was removed from life support on the morning of April 28, 2011.  The lead physician determined that, in his opinion, C.P.’s death was due to the results of a combination of blunt force trauma, due to an impact to the back of the head, and violent rotational head trauma, such as from shaking.  An autopsy conducted by  an Assistant Chief Medical Examiner for the Commonwealth of Virginia found the cause of C.P.’s death was craniocerebral and spinal cord injuries and the manner of death a homicide. 

            In an interview, the defendant admitted that she repeatedly shook C.P., and caused C.P.’s head to strike the wall because C.P. was screaming.  The defendant also admitted she shook C.P. on a separate occasion approximately three weeks earlier.

            This case was investigated by NCIS.  Assistant United States Attorney Patricia Haynes and Special Assistant United States Attorney Stacey Luck are prosecuting the case on behalf of the United States.

A copy of this press release may be found on the website of the United States Attorney's Office for the Eastern District of Virginia at http://www.usdoj.gov/usao/vae.  Related court documents and information may be found on the website of the District Court for the Eastern District of Virginia at http://www.vaed.uscourts.gov or on http://pacer.uspci.uscourts.gov.

RICHMOND, Va. – Jose Armando Bran, also known as “Pantro,” 30, of Richmond, Va., was convicted today by a federal jury on murder and maiming in aid of racketeering, among other charges.

         Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Mythili Raman, Acting Assistant Attorney General for the Justice Department’s Criminal Division; Jeffrey C. Mazanec, Special Agent in Charge of the FBI’s Richmond Field Office; John P. Torres, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Washington; and Michael Herring, Richmond Commonwealth Attorney, made the announcement after the verdict was accepted by Senior United States District Judge Robert E. Payne. 

Branfaces a maximum penalty of life in prison when he is sentenced on August 15, 2013.

“Nothing can bring back the life that was brutally taken on July 24, 2011, but with today’s verdict, those MS-13 members who murdered, and later stabbed, in the name of their gang have been brought to justice,” said U.S. Attorney Neil H. MacBride. “My office has made the investigation and prosecution of transnational street gang La Mara Salvatrucha Thirteen a top priority.  We have successfully prosecuted MS-13 for the last decade and as this verdict makes clear, we remain fully committed to holding accountable any and all MS-13 members who violate the law.  Whether it is juvenile sex trafficking in Northern Virginia or vicious gang initiation murders in Richmond, we will aggressively continue our efforts to prosecute and eradicate MS-13 from the Eastern District of Virginia.”

        "Today's conviction of Jose Bran is a prime example of the FBI's commitment to disrupt and dismantle violent criminal gangs in the Commonwealth of Virginia,” said Special Agent in Charge Mazanec.  We thank the City of Richmond Police Department and Homeland Security Investigations, and our other law enforcement partners who have dedicated their efforts to the common cause of eradicating MS-13 from our neighborhoods."

          “MS-13 is a violent transnational gang that poses a significant threat to public safety,” said Special Agent in Charge Torres.  Today’s verdict holds Jose Bran accountable for his role in the crimes of murder and attempted murder in the Richmond area. HSI is committed to working with our law enforcement partners in combating dangerous criminal organizations. ”

Bran was indicted on August 7, 2012, by a federal grand jury.  The Government charged Bran with racketeering and firearms offenses to include: two counts of conspiracy to commit murder, murder, maiming, and use of a firearm during a crime of violence resulting in death.   According to court records and evidence adduced at trial, Bran was responsible for orchestrating a gangland style execution of victim Osbin Hernandez-Gonzalez.  Bran, who served as the leader of MS-13’s Sailors Locos Salvatrucha clique in Richmond, Virginia, suspected that Hernandez-Gonzalez had violated MS-13 rules by aiding a rival gang.  Based upon this suspicion, Bran created a ruse to lure Hernandez-Gonzalez to the “Pony Pasture” area on the banks of the James River.  Specifically, Bran ordered that MS-13 associate Karen San Jose contact Hernandez-Gonzalez and convince him to gather with other MS-13 members.  Bran also enlisted the help of two juveniles who were tasked with actually carrying out the murder of Hernandez-Gonzalez.  Finally, to ensure the murder was carried out, Bran instructed MS-13 member Michael Arevalo, also known as “Reptile,” to accompany the juveniles on the “mission” and to ensure the juveniles completed the murder, which Arevalo did. 

San Jose and Arevalo previously pleaded guilty for their roles in the murder.  Arevalo is scheduled to be sentenced on July 25, 2013, and San Jose is scheduled to be sentenced on June 20, 2013.  Arevalo faces a maximum of life imprisonment and San Jose faces a maximum of 20 years’ imprisonment. 
In or around January of 2012, Bran was told that an individual with the initials F.A. was supplying information about the Richmond Sailors Set to a rival gang.  Bran also came to suspect the loyalty of MS-13 associate Justin Amador.  A plan was developed to have Justin Amador kill F.A. to punish the supposed-informant and thereby also test Amador’s loyalty.

        On January 14, 2012, Bran directed that the plan be carried out.  Sometime that evening Giovanny Torres, along with Justin Amador, Mario Molina, and Marvin De Leon, drove the victim to a nightclub in Richmond.  They left after forty-five minutes, telling the victim that they were all going to go commit a burglary. They drove to the vicinity of the 3800 block of Terminal Avenue in Richmond, Virginia.  After they arrived, the victim, De Leon and Justin Amador got out of the car.  After a signal from Torres, De Leon grabbed the victim, pulled the victim’s sweatshirt over his head and held him while Justin Amador stabbed the victim at least 14 times.  The victim escaped and fled to a nearby residence while the others drove away. The victim lost a portion of one lung as a result of the attack.

De Leon, Molina, Amador and Torres previously pleaded guilty for their roles in the stabbing.  Molina was sentenced to 293 months’ imprisonment.  Torres was sentenced to 235 months’ imprisonment.  De Leon and Amador’s sentencing hearings have not been set.
This case was investigated by the Federal Bureau of Investigation, Homeland Security Investigations and the Richmond Police Department Assistant United States Attorney Roderick C. Young and Trial Attorney Andrew L. Creighton of the Department of Justice’s Organized Crime and Gang Section are prosecuting the case on behalf of the United States.

ALEXANDRIA, Va. – Larren Wade, 55, of Venice, Fl., a former doctor who had a medical practice in Alexandria, Va., was sentenced to 70 months in prison, followed by 3 years of supervised release for conspiring to distribute oxycodone. 

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; Karl C. Colder, Special Agent in Charge for Drug Enforcement Administration (DEA)’s Washington Field Division; Earl Cook, Alexandria Chief of Police; and Colonel W. Steven Flaherty, Virginia State Police Superintendent, made the announcement after the sentenced was pronounced by United States District Judge Claude M. Hilton. 

            According to court documents, Wade admitted that between March and July 2010, he issued thousands of prescriptions for pain medications, sometimes exceeding 2,000 pills per patient each month. Wade frequently issued these prescriptions without conducting a physical examination, without reviewing prior medical records, and without establishing a treatment plan. During this time, Wade also operated an almost strictly cash business and would typically see between 30 and 50 patients per day, but in at least one instance saw more than 100 patients in a single day and collected nearly $10,000 in cash. 

            Court records indicate that Wade was the subject of an undercover operation by law enforcement officials, and he issued numerous prescriptions for oxycodone to two undercover officers for no legitimate medical purpose. In addition, the undercover officers asked if they could obtain a prescription for a “friend” who did not exist.  As a part of the conspiracy, two prescriptions for oxycodone were written for the fictitious patient after an $85 office visit fee was paid.  After the transaction was completed, Wade created a patient file for the fictitious patient.

            Oxycodone is the active ingredient in brand name pills such as OxyContin, Roxicodone and Percocet.  It is a Schedule II controlled substance and can be useful in assisting with pain management issues; however, it has a high potential for abuse and abuse of the drug can lead to severe psychological or physical dependence.

            This case was investigated by the DEA’s Washington Field Division, FBI’s Washington Field Office, Virginia State Police, and the Alexandria Police Department.  Special Assistant United States Attorneys Stacey Luck and Elizabeth N. Eriksen are prosecuting the case on behalf of the United States.

This case is part of an Organized Crime and Drug Enforcement Task Force (OCDETF) investigation dubbed Operation Cotton Candy, which has been focusing on the illegal distribution by numerous doctors, pharmacists, nurses, and patients of pain medication. This OCDETF matter has secured more than 200 drug-trafficking convictions and guilty pleas.

NEWPORT NEWS, Va. –Marcellus Edward Cheatham, III, 27, of Richmond, Va., was convicted today by a federal jury of brandishing a firearm during a crime of violence and being a felon in possession of ammunition. On the first day of trial, Tuesday, May 14, 2013, Cheatham pled guilty to robbing a Walgreens pharmacy, and possessing Oxycodone stolen in the robbery, with the intention of distributing or selling it. He proceeded to trial on the remaining charges.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Carl J. Vasilko, Special Agent in Charge of the Bureau of Alcohol, Tobacco, Firearms and Explosives’ (ATF) Washington Field Division, and, Thomas Townsend Hampton Police Chief, made the announcement after the verdict was accepted by United States District Judge Henry C. Morgan, Jr.

            Marcellus was indicted on November 15, 2012 on charges of robbery, felon in possession of a firearm and brandishing a firearm in relation to the robbery. A superseding indictment was returned in March 11, 2013, adding charges of felon in possession of ammunition and possession with intent to distribute Oxycodone.

            According to court records, and evidence at trial, Cheatham planned and carried out the robbery of the Walgreens store at 919 W Mercury Boulevard in Hampton on August 21, 2012, after driving from Richmond to Hampton to commit the robbery. Cheatham entered the Walgreens, approached a pharmacist, and threw a demand note at him. When the pharmacist bent over to pick the demand note up Cheatham jumped over the counter and, brandishing a firearm, told the pharmacist to give him all his Percocet which is a brand of Oxycodone. After obtaining Percocet in a bag, Cheatham walked out of the pharmacy and returned to his residence in Richmond. Fingerprints found at the scene linked Cheatham to the crime. Agents executed a search warrant at Cheatham’s residence a few days later and recovered bottles of Percocet taken in the robbery.      

            This case was investigated by the ATF’s Washington Field Division and the Hampton Police Division.  Managing Assistant United States Attorney Howard J. Zlotnick and Special Assistant United States Attorney Rebecca A. Staton from the Criminal Division’s Gang Unit prosecuted the case on behalf of the United States.

NORFOLK, Va. – Robert Charles Beatty, 33, of Virginia Beach, Va., pleaded guilty today to charges in connection with distributing synthetic marijuana at a drug-involved premise. 

        Neil H. MacBride, United States Attorney for the Eastern District of Virginia and Karl C. Colder, Resident Agent in Charge, Drug Enforcement Administration, made the announcement after the plea was accepted by United States District Judge Arenda Wright Allen.       

        Beatty faces a maximum penalty of 20 years imprisonment when he is sentenced on September 6, 2013.

In a statement of facts filed with the plea agreement, the investigation began in July 2012 with information that the defendant was distributing synthetic marijuana in Virginia Beach.  Surveillance was conducted at the residence of the defendant. Within 72 hours of the execution of a search warrant on August 10, 2012, a confidential informant made a purchase of synthetic marijuana from the defendant at his residence on Garrison Place in Virginia Beach, Virginia.  On August 10, 2012, members of the VBPD/Special Investigations executed a search warrant at a residence on Garrison Place, Virginia Beach, Virginia.  Located inside the residence was a large quantity of synthetic marijuana inside boxes, processed marijuana, pills, a digital scale, paperwork and paraphernalia.  Approximately 61 kilogram of synthetic marijuana was seized under the brand/street names of: spice, G-13, Scooby Snacks, G-20, The Original Cloud 9, Mr. Happy, Atomic, California Dreams, Hypnotic, After Life, Guerrilla Warfare, Grape Ape, Down 2 Earth, Fairly Legal, and others.  The defendant, after Miranda warnings, confessed to selling synthetic marijuana and prescription pills.  The defendant also confessed that he had conspired to ship and to sell synthetic marijuana and split the proceeds with others.    The defendant also admitted he maintained a drug-involved premise to manufacture, distribute, and use various controlled substances. 

        This case was investigated jointly by Drug Enforcement Administration and the Virginia Beach Police Department.  Assistant United States Attorney Kevin M. Comstock is prosecuting the case on behalf of the United States.

ALEXANDRIA, Va. – Mark S. Farhood, 49, formerly of San Diego, Cal., and Jason S. Sant, 37, of Lecanto, Fla., pleaded guilty today to conspiracy charges in connection with their operation of a nationwide online foreclosure rescue scam that went by various names, including Home Advocate Trustees and Walk Away Today, and used various web sites, including walkawaytoday.org and sellfastusa.com, to deceive hundreds of vulnerable, distressed homeowners into surrendering their properties to the company. 

Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Christy L. Romero, Special Inspector General for the Troubled Asset Relief Program, or SIGTARP; and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after the pleas were accepted by United States District Judge Anthony J. Trenga.  Farhood and Sant each face a maximum penalty of 30 years in prison when they are sentenced on August 2, 2013, and August 9, 2013, respectively.

According to court records, Farhood and Sant co-owned Home Advocate Trustees, which also went by the names Walk Away Today, First Equity Trustees, Home Security Consultants, Sell Fast USA, Short Sale Buyer, USA Sell House Fast, and USA Rental Housing.  They marketed the businesses nationwide as purchasers of distressed real estate and a means by which vulnerable homeowners could avoid foreclosure and the accompanying negative effects on their credit.  The companies told homeowners they were in the business of negotiating with lenders to purchase mortgage notes at a discount and falsely claimed to have been in business for seventeen years, to have experienced a 90% success rate in purchasing such notes, and to be the nation’s largest volume buyer of short sale and over-leveraged real estate. 

As Sant and Farhood admitted in connection with their pleas, the businesses were a fraud, no such negotiations with lenders ever took place, and the scheme was merely a way for them to take possession of hundreds of residential properties, including homes within the Eastern District of Virginia, at virtually no cost and then reap millions of dollars in profits by renting the homes to unsuspecting tenants. 

Farhood and Sant further admitted that as part of the scheme, they submitted fraudulent loan modification applications to mortgage lenders under the U.S. Department of the Treasury’s Home Affordable Modification Program (“HAMP”) in the name of homeowners, without the homeowners’ knowledge or consent.  Farhood and Sant used the fraudulent applications to stall foreclosures on the properties under their control and for which no mortgage payments were being made and to maximize the time period during which they could collect rental income.

The homes purportedly sold to Home Advocate Trustees and its related entities ended in foreclosure, harming the participating homeowners and commonly resulting in eviction of the tenants.
This ongoing investigation is being conducted by SIGTARP and the FBI’s Washington Field Office.  Assistant United States Attorney Paul J. Nathanson is prosecuting the case on behalf of the United States.

ALEXANDRIA, Va. – Yanira del Carmen Guerrero Andrade, also known as “Yadira” or “Litsy,” 28, an illegal alien from El Salvador who had been residing in Adelphi, Md., was sentenced today to 132 months in prison, followed by five years of supervised release, for recruiting a 15-year-old, pregnant runaway to engage in commercial sex acts for a trafficking ring with ties to the notorious street gang Mara Salvatrucha Thirteen (“MS-13”).
            Neil H. MacBride, United States Attorney for the Eastern District of Virginia, Ken Cuccinelli, Attorney General of Virginia, and John P. Torres, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Washington, D.C., made the announcement after sentencing was pronounced by United States District Judge Liam O’Grady.
            “Defendant Guerrero Andrade was in a position to aid the victim of this unconscionable act, but instead of helping her, she helped perpetuate her exploitation,” said U.S. Attorney Neil H. MacBride. “She now has 11 years in federal prison to think about her decision.  This prosecution is another example of our commitment to prosecuting anyone who participates in this vile crime.”
            “Andrade took advantage of a vulnerable, scared teenage runaway, and instead of helping her, she prostituted her through a gang,” said Cuccinelli. “What is even more sinister is that she took advantage of a young pregnant mother, creating two victims of her crime. The attorney general’s office is committed to fighting human trafficking and protecting Virginia’s most vulnerable citizens from predatory monsters like Guerrero Andrade.”

            Special Agent in Charge John P. Torres stated, “Guerrero Andrade knew the victim was a minor and exploited that vulnerability by luring her into a life of prostitution with the violent street gang, MS-13.  Child sex trafficking is a heinous crime, and HSI is committed to protecting victims and to dismantling human trafficking organizations globally.”
            According to documents filed with the court, Guerrero Andrade first met the juvenile victim in 2008 at a nightclub in Hyattsville, Md.  At the time, the victim had run away from home. Guerrero Andrade placed the juvenile victim with an MS-13 associate, and later, recruited her to work as a prostitute for an organization run by Guerrero Andrade’s boyfriend, Julio Revolorio-Ramos.  Guerrero Andrade and Revolorio-Ramos then transported the victim from Maryland to northern Virginia for purposes of prostitution. 
            On the first day the victim was trafficked, she was trafficked to approximately 15 customers, and on the third day she was trafficked to 25 customers. Guerrero Andrade knew that the victim was less than 18 years old and instructed her to use an alias and say that she was 20 years old.  Several customers requested the victim specifically because she appeared underage.  Guerrero Andrade and her boyfriend kept a portion of the proceeds the victim earned. Guerrero Andrade also referred the victim to other traffickers besides her boyfriend so that those “pimps” could also traffic the victim.
            Revolorio-Ramos previously pleaded guilty to Sex Trafficking of a Child, and was sentenced to 188 months of incarceration and five years of supervised release. 
            This case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations (HSI) in Washington, D.C., with assistance from the Northern Virginia Human Trafficking Task Force. Virginia Assistant Attorney General and Special Assistant United States Attorney Marc J. Birnbaum and Assistant United States Attorney Michael J. Frank are prosecuting the case on behalf of the United States.
            Founded in 2004, the Northern Virginia Human Trafficking Task Force is a collaboration of federal, state, and local law enforcement agencies – along with nongovernmental organizations – dedicated to combating human trafficking and related crimes.

ALEXANDRIA, Va. — James Raymond Schimmel, 53, of Alexandria, Virginia, was sentenced today to 10 years in prison, followed by 5 years of supervised release, for enticing a minor to engage in criminal sexual activity.  At the time of his arrest on October 24, 2012, Schimmel was an employee of the U.S. Patent & Trademark Office.

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and John P. Torres, Special Agent in Charge for U.S. Immigration and Customs Enforcement’s Homeland Security Investigations in Washington, D.C., made the announcement after sentencing by United States District Judge Liam O’Grady.

According to court records, Schimmel met the minor victim through the Internet and convinced the victim to meet in person for the purpose of engaging in criminal sexual activity.  Schimmel then video recorded the sexual encounter without the victim’s knowledge.  Further investigation revealed that Schimmel had been engaging in similar communications with other minors in the mid-Atlantic area.

            The case was investigated by U.S. Immigration and Customs Enforcement’s Homeland Security Investigations, the Northern Virginia Internet Crimes Against Children Task Force, and the Virginia State Police.

Assistant United States Attorneys Alexander T.H. Nguyen and Ryan K. Dickey are prosecuting the case on behalf of the United States.

ALEXANDRIA, Va. – Kenneth H. DiPasquale, 38, of Morgantown, W. Va., was sentenced today to 42 months in prison, followed by three years of supervised release, for his role in a series of fraudulent mortgage loan transactions, including one in which he stole an individual’s identity and “sold” that individual his home for a nearly $320,000 profit.  DiPasquale was also ordered to pay a total of $3,354,773 in restitution to his victims and to forfeit $529,098 in proceeds from his crimes. 

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia; Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office; and Gary R. Barksdale, Inspector in Charge of the Washington Division of the United States Postal Inspection Service made the announcement after sentencing by United States District Judge Anthony J. Trenga.  DiPasquale previously pleaded guilty to conspiracy and aggravated identity theft charges on January 25, 2013.    

            According to court records, DiPasquale was employed in 2007 as a loan officer at Landover, Md., mortgage lender Citywide Mortgage.  DiPasquale used that position to process loans based on false and fraudulent information, including for borrowers who had not applied for loans and who had no idea their names and identities had been used as borrowers in the transactions.  In particular, DiPasquale processed fraudulent loans in exchange for kickbacks from a co-conspirator.  When he had trouble selling his own home in Bowie, Md., in October 2007, he stole the identity of an individual living in Arlington, Va., and “sold” this victim his house at a nearly $320,000 profit.  He also engineered a series of transactions involving a homeowner in Hyattsville, Md., whom he swindled out of over $193,000. 

Co-conspirator Nadin Samnang, a former Virginia realtor and title company owner, was convicted of mortgage fraud-related charges following a trial in April 2012 and was sentenced to 84 months in prison.  Co-defendant Lyle C. Williams pleaded guilty to conspiracy and identity theft charges in November 2012 and was sentenced to 18 months in prison.

This case was investigated by the FBI’s Washington Field Office and the U.S. Postal Inspection Service.  Assistant United States Attorney Paul J. Nathanson prosecuted the case on behalf of the United States.

ALEXANDRIA, Va. – Blake David Coleman O’Gara, 30, of Ashburn, Virginia, was sentenced this morning to 78 months imprisonment, followed by a lifetime of supervised release, after his guilty plea to receipt of child pornography.

Neil H. MacBride, United States Attorney for the Eastern District of Virginia, and Valerie Parlave, Assistant Director in Charge of the FBI’s Washington Field Office, made the announcement after sentencing today by United States District Court Judge T.S. Ellis, III.

            According to court documents and court proceedings, O’Gara downloaded child pornography images and videos from various websites and a peer-to-peer file sharing program from October 2010 to October 2012.  A search warrant executed on October 23, 2012 revealed that O’Gara had more than 600 images and videos of child pornography on his computers.

The investigation was conducted by the FBI Washington Field Office’s Child Exploitation Task Force. 

Special Assistant United States Attorney Alicia J. Yass, a Trial Attorney with the Child Exploitation and Obscenity Section of the Justice Department’s Criminal Division, is prosecuting the case on behalf of the United States.

This case was brought as part of Project Safe Childhood, a nationwide initiative to combat the growing epidemic of child sexual exploitation and abuse launched in May 2006 by the Department of Justice. Led by United States Attorneys’ Offices and the Criminal Division's Child Exploitation and Obscenity Section (CEOS), Project Safe Childhood marshals federal, state and local resources to better locate, apprehend and prosecute individuals who exploit children via the internet, as well as to identify and rescue victims. For more information about Project Safe Childhood, please visit www.projectsafechildhood.gov.

NEWPORT NEWS, Va. – Glenn Rodger McGuire, 41, of Newport News, Va. was sentenced today to 188 months in prison and a lifetime of supervised release for receipt of child pornography. 

            Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement after sentencing by United States District Judge Henry C. Morgan, Jr. 

            McGuire pled guilty on February 6, 2013.  According to court documents, McGuire was a Cox Communications employee who set up his neighbors’ wireless router for a fee. During an FBI investigation the neighbors’ wireless router was identified as possibly being linked to a computer that was accessing and downloading child pornography. Agents contacted the neighbors believing their computer was being used, but no child pornography was found.  The agents then went to the home of McGuire and after obtaining McGuire’s consent, seized his computers.  Following execution of a search warrant, a forensic exam was conducted which revealed over 6,000 images of child pornography.

            This case was investigated by FBI.  Assistant United States Attorney Lisa R. McKeel prosecuted this case on behalf of the United States.

This case was brought as part of Project Safe Childhood, a nationwide initiative launched in May 2006 by the Department of Justice to combat the growing epidemic of child sexual exploitation and abuse. Led by the United States Attorneys' Offices and the Criminal Division's Child Exploitation and Obscenity Section, Project Safe Childhood marshals federal, state, and local resources to locate, apprehend, and prosecute individuals who sexually exploit children, and to identify and rescue victims. For more information about Project Safe Childhood, please visit www.usdoj.gov/psc  For more information about internet safety education, please visit www.usdoj.gov/psc and click on the tab “resources.”